Visteon Cutting 1,800 Jobs

Visteon (VC), the third-largest maker of vehicle parts, said it plans to immediately eliminate about 1,800 jobs worldwide.

The Dearborn, Mich. -based company said that the 2% reduction in its workforce is a result of a slowdown in vehicle production in the United States.

About 850 of the cuts will be will be in the United States, reducing the domestic workforce by about 12%. The company said the moves will result in a one-time, second-quarter charge of about $135 million.

However, it is sticking with its first-quarter earnings estimate of $20-$30 million. Analysts are expected the company to earn 16 cents per share for the quarter ended March 31. Visteon will report earnings later this month.

Visteon was spun off by Ford (F) last year. Although it is Visteon’s largest customer, Ford’s plans to reduce North American production by 7% negatively impacted the company.

Throughout the first three months of 2001, the company had idled thousands of workers for one-week periods as demand slowed.

This announcement came less than a week after larger rival Delphi Automotive Systems (DPH) said it plans to cut 11,500 jobs for similar reasons. (See story from March 29)

Nearly all suppliers of vehicle parts are seeing less demand as automakers reduce production because of slower sales of new cars and trucks in the U. S.

(Click here for the full press release. )

By Transport Topics