Rockwell Automation will cut approximately 600 jobs “immediately” as part of a massive restructuring which will see the company consolidate its business units and save a substantial AU$112 million, according to a statement from the company.
The world’s largest factory automation player will begin “streamlining” sales and administrative roles, as well as “realigning selling resources to the highest growth opportunities and consolidating business units,” according to an official statement to the press from the company’s head office in Milwaukee.
The restructuring is a result of a “comprehensive analysis of the company’s cost structure” and is expected to save Rockwell AU$112 million in fiscal 2009, growing to AU$85 million the year after, according to the statement.
Rockwell will also incur a pre-tax charge of around AU$74 million in the fourth quarter of this calendar year. This sum was not included in previous guidance which Rockwell provided to shareholders, meaning Rockwell’s stock might not plunge as much as expected in light of the current climate.
The cost cuts are due to current and anticipated market conditions, which suggests that Rockwell is feeling the pinch from the current volatile credit environment.
Rockwell chief executive officer and chairman, Keith D. Nosbusch, said that the company’s actions should not surprise shareholders considering Rockwell mentioned earlier in the year that its first priority was to look after its bottom line.
“These actions are consistent with the cost management approach we outlined in July. Although fourth quarter revenue is in line with expectations, we believe it is prudent to take steps to address our cost structure while continuing to invest to maintain our competitive differentiation and further strengthen our global presence,” he said.
Staff redundancies will represent approximately three per cent of the company’s global workforce.
Contact Rockwell Automation by visiting www.rockwellautomation.com.au