Cummins Inc., following through on a warning of further cost cuts, said it will eliminate at least 800 “professional” jobs by the end of February and is freezing salaries for the year.
CNNMoney reported that the engine maker, which is suffering from slumping demand because of the woes affecting the global automobile industry, also said it will cut company officers’ 2009 salaries by 10%.
The Columbus, Ind.-based firm supplies diesel engines to the recreational vehicle industry and is also parent to generator maker Onan.
Combined with job cuts announced last month, Cummins is reducing its professional work force by more than 1,400 people, or 10%. The company has reduced its hourly work force by more than 600 and cut approximately 2,500 contingent workers. As part of the latest cuts, Cummins will offer a second round of early retirement packages to certain U.S. professional employees.
“It is unfortunate that after five straight years of record performance and greatly improved business fundamentals we are being forced to take these difficult actions,” said Chairman and CEO Tim Solso. “While these steps are very painful, they are necessary to keep Cummins competitive through this global recession so we can emerge a stronger company when the economy and our markets recover.”
Cummins warned a month ago it was planning more cost cuts. At that time, Cummins reduced its 2008 forecast amid slumping fourth-quarter demand, particularly the hard-hit North American and European truck and construction markets.