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Published: Friday, 3/30/2001

Sandusky, Adrian to lose workers as Delphi announces massive cuts

FROM BLADE STAFF AND WIRE REPORTS

Delphi Automotive Systems Corp., the world's largest auto parts supplier, yesterday announced a massive restructuring plan that will eliminate 11,500 jobs and sell or close nine plants worldwide.

None of the plants to be sold or closed are in northwest Ohio or southeast Michigan. But the cuts include 240 of 1,500 jobs at its Sandusky plant and 70 of 650 jobs at its Adrian plant.

The cutbacks of 5 percent of its work force at about 50 of the company's 200 plants are in response to a soft U.S. auto market that will leave its first-quarter earnings short of Wall Street forecasts. The plant shutdowns mean the company will exit $900 million in business.

“The actions outlined today should improve our ability to rebound decisively in more favorable automotive market conditions,” Alan Dawes, Delphi's executive vice president and chief financial officer, said in a statement.

Its stock closed at $14.52 a share yesterday, up 58 cents or just over 4 percent.

Ohio, which has eight Delphi plants employing 17,000, is to lose 1,500 jobs. The company said it will cut the same number in Michigan where it has 15,000 employees at eight plants. No Ohio plants are to be closed or sold; in Michigan, a Saginaw factory will be closed.

The planned job cuts affect 5,600 of Delphi's U.S. hourly workers, 3,900 workers outside the United States, and 2,000 white-collar workers nationwide. Delphi expects to eliminate those jobs through early retirements, voluntary separation incentives, and attrition.

Delphi plans to take a first-quarter charge of $400 million after taxes, with all of the restructuring expected to be completed within a year.

Given weaker-than-expected orders from automakers and for replacement parts, the company said it expects first-quarter revenues of $6.4 billion to $6.5 billion, or $100 million to $150 million less than what had been forecast in January. During the same three months last year, Delphi had revenues of $7.8 billion.

There are about 300 workers on temporary layoff at the company's factory south of Sandusky in Perkins Township, where 1,350 hourly and 200 salaried workers make front and rear spindle bearings and clutches for transmissions. The Adrian plant, which makes instrument panels and door trim, has no current layoffs among its 570 hourly and 80 salaried workers.

The company, spun off by GM in 1999, has about 71,000 U.S. workers, 51,000 of them hourly.



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