The Timken Company (USA; NYSE: TKR) formally announced what many already know -- it is aggressively targeting administrative and overhead expenses in an ongoing effort to control costs and better match nonproduction assets to market opportunities.
Cuts have already started, and will continue through third quarter 2009, putting at least 400 more white collar employees on the street. The cost will be between $10 and $15 million.
Timken said it expects to realize between $30 and $40 million in annualized SG&A savings, helping it compete going into a changed and somewhat unpredictable economic and world market picture for bearing manufacturers.
The company has indicated these cutbacks should be considered permanent in the areas affected -- with the consideration that its opportunities and requirements are and will continue to be different than the organization had been set up to meet.
Since late 2007, Timken has reduced its hourly production workforce -- direct labor -- by more than 2,500. In addition, many plants are working short weeks and fewer hours.
These hourly production cutbacks are also not done, however; Timken said, "Additional permanent adjustments will be made as necessary to right-size capacity to market needs."
President and CEO, Jim Griffith, went on to say, "We're balancing capacity through reduced labor and output. Our focus now is to align our administrative and sales functions to be more effective in today's challenging environment. As we operate with a leaner organization, we will continue to focus on improving profitability and cash flow -- as we strengthen the Timken brand across the globe."
Other News:
Timken Administrative Cuts are Likely to be Permanent
Ruland Develops Quick-clamping Shaft Collars
GGB Wins KEIPER Supplier Award
Schaeffler Group a top 30 Winner in the NoAE Innovation Award 2009
PTDA Releases May 2009 Market Outlook Report
SKF Reinforces Signs That Global Slump Has Hit Bottom
NSK Precision America Demonstrates Six Next Generation Products at Semicon
igus Offers Plant Shutdown Inspections
