Whirlpool to cut 5,000 jobs [report on TV said jobs were being sent to Mexico]
By MAE ANDERSON ASSOCIATED PRESS
NEW YORK — Whirlpool plans to cut 5,000 jobs, about 10% of its workforce in North America and Europe, as it faces soft demand and higher costs for materials.
The world’s biggest appliance maker also on Friday cut its 2011 earnings outlook drastically and reported third-quarter results that missed expectations, hurt by higher costs and a slowdown in emerging markets.
The company, whose brands include Maytag and KitchenAid, has, like other appliance makers, been squeezed by soft U.S. demand since the recession and rising costs for materials such as steel and copper. Because of its size, Whirlpool’s performance provides a window on the economy because it indicates whether consumers are comfortable spending on big-ticket items.
Benton Harbor-based Whirlpool has raised prices to combat higher costs, but demand for items like refrigerators and washing machines remains tight.
To offset slowing North American sales, Whirlpool has turned to emerging markets. But the company said Friday that sales have slowed there, too. The company revised its demand forecast globally. It now expects demand to decline 3% to 5% in North America, in 2011.
Steep costs and the dour global economy are affecting the entire appliance industry. Swedish appliance maker Electrolux said Friday that its third-quarter net income fell 39% and also cut its forecast for demand in North America and Europe for the year.
Whirlpool jobs to be cut are mostly in North America and Europe. They include 1,200 salaried positions and the closing of the company’s Ft. Smith, Ark., plant.