Cummins Details Significant Cuts
Cummins ranks third among its peers.
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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowColumbus-based Cummins Inc. says a slowdown in global markets is leading to the decision to cut up to 2,000 workers, mostly by the end of the year. The engine maker has lowered its outlook for 2015, projecting revenues to be flat to down two percent. Cummins says the adjustments will be made on a "facility-by-facility basis," and the company will decide if more restructuring actions are needed in the coming months.
The manufacturer says the moves will result in savings of $160 million to $200 million per year. Chief Executive Officer Tom Linebarger calls the cuts "difficult but necessary" as the company faces weak demand in several markets.He says Cummins expects the challenging conditions to "persist for some time," but believes the company will emerge stronger and more profitable.
Cummins says third quarter net income was $380 million, down from $423 million during the same period the previous year. The company reported third quarter revenue of $4.6 billion, which is a six percent decrease from the previous year.
In April, Cummins broke ground on a global Distribution Business headquarters in downtown Indianapolis. The building on the former Market Square Arena property is expected to open in late 2016. The 10-story tower will include retail space and public greenspace. When the company announced the plans in December, Indianapolis Mayor Greg Ballard called it a "bold and visually compelling" gateway to the city.