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Whirlpool rules out job cuts in the Middle East

The company announced a $150m cost cutting programme at the end of 2017

Image Credit: Supplied
Washing machines and laundry appliances of Whirlpool. A Whirlpool spokesperson clarified that there had been “no moves to cut jobs” in the region.
Gulf News

Dubai: Whirlpool, the maker of home appliances such as washing machines and refrigerators, has ruled out job losses in the Middle East as part of its ongoing $150 million (Dh550.5 million) global cost-cutting programme.

The cuts already resulted in a round of redundancies at two of Whirlpool’s Michigan locations towards the end of January, while the company has not said whether staff in the US should expect more layoffs.

“I cannot go in to specific details, because we don’t provide that type of information, but of course in general we’re looking for efficiencies,” Europe, Middle East, and Africa president Esther Berrozpe Galindo said, when asked if the cost-cutting would translate in to job losses in the Middle East.

Later, a Whirlpool spokesperson clarified that there had been “no moves to cut jobs” in the region.

The company would not commit to adding jobs, however.

The term efficiency is often used by businesses to refer to costs that are deemed unnecessary, or processes that can be streamlined.

One of the common costs that companies appraise when they look for “efficiencies” is headcount, and the cost of wages, sometimes leading to job losses.

Explaining the company’s decision to look for such efficiencies, Galindo told Gulf News in a recent interview that Whirlpool had reached the conclusion that it needed to reduce its fixed costs.

Dismal fourth quarter

“This is a consequence of raw material prices going up, and putting pressure on the company,” she said.

The company also suffered a dismal fourth quarter, posting a net loss of $268 million in its financial results, released in January. This was due in large part to a one-time tax charge. “Of course, the fixed cost reductions come through efficiencies,” she added.

Galindo said that these efficiencies would come from many different areas: “Efficiencies in the way we work, manufacturing, logistics, et cetera.”

The regional president went on to say that Europe, the Middle East and Africa (EMEA) would see its fair share of cost reductions, due to its size.

“Of course, the [EMEA] region has its share of that. If you think that 25 per cent of our revenues are in EMEA…,” she said.

In 2011, Whirlpool, one of the world’s biggest appliance manufacturers, said it would slash 5,000 jobs, or 10 per cent of its workforce, amid slowing sales and rising material prices.

The company currently employs about 97,000 workers globally.

Referring to the most recent job cuts in the US, Galindo said: “As you know, in the US we’ve already announced a round of layoffs. In Europe, it’s a bit more complicated, because different countries have different labour laws.”

She concluded by saying that the company was “working towards” cutting costs in the EMEA region, with the company calling it a “good opportunity to generate efficiencies…”