Dow to reduce workforce by 2,000, targets cost savings of USD1 billion
Dow Inc., based in Midland, Michigan, U.S.A. announced cuts in spending amounting to USD1 billion, including a global workforce reduction affecting 2,000 positions.
The global chemical company also revealed it will close selected assets, “while further evaluating Dow's global asset base, particularly in Europe, to ensure long-term competitiveness and enhance cost efficiency.”
Together with end-to-end process improvements, Dow expects to save USD500 million with these structural improvements.
An additional USD500 million in savings will come from reductions in operating expenses, such as turnaround spending andraw material purchases.
"We are taking these actions to further optimise our cost structure and prioritise business operations toward our most competitive, cost-advantaged and growth-oriented markets, while also navigating macro uncertainties and challenging energy markets, particularly in Europe," said Jim Fitterling, Dow chairman and CEO. "We remain committed to capitalising on our long-term growth opportunities in a disciplined and balanced manner, and these actions further position us to advance our Decarbonize and Grow strategy and strengthen our competitive position."
Dow will record a charge of USD550 million to USD725 million in the first quarter of 2023 for costs associated with these activities, which primarily include severance and related benefit costs; costs associated with exit and disposal activities; and asset write-downs and write-offs.