Domestic appliance supplier reduces employee numbers after ‘sharp decline in demand’ means the company won’t reach full year target for 2008.
Electrolux will cut more than 3,000 jobs globally in a cost saving exercise. The Swedish company has blamed weakening demand for appliances in Europe and North America for the move, stating that 'the weak market has had a negative impact on Electrolux sales volumes and product mix during the fourth quarter".
Electrolux posted an operating profit SEK2.7bn (£226m) and added that, as a consequence, it was no longer possible to achieve its 2008 target of between SEK 3.3-3.9bn.
A statement from the company read: "Measures have been launched to reduce the number of employees by more than 3,000 I the fourth quarter of 2008 and continue in 2009. All operations on a global basis are affected...The savings are expected to amount to approximately SEK 1.1bn on a yearly basis, with full effect as of 2010."
Electrolux will also move its production capacity to 'low-cost countries' in accordance with its restructuring plan, launched in 2004. This will result in a further reduction of its workforce.