Engine builder Cummins Inc. reduced its 2008 sales and earnings margin forecast and will slash jobs as economies falter across the world, according to a report on Briefing.com.
The company now expects 2008 sales to increase by 9% to $14.2 billion, down from its previous forecast and consensus estimate of 12% growth to $14.6 billion. Earnings before interest and taxes are expected to be slightly more than 9% sales, which is down from its previous guidance of 10%.
The reduced guidance comes following what the company called a “rapid” decline in engine and component sales. Meanwhile, heavy-duty and medium-duty truck and construction markets were hit hard in recent weeks.
The Columbus, Ind.-based firm supplies diesel engines to the recreational vehicle industry and is also parent to generator maker Onan.
Because Cummins does not believe market conditions will improve significantly in the near-term, it is taking steps to manage costs and production.
Cummins will temporarily shut down plants, shorten work weeks, extend holiday closes and eliminate temporary employees at a number of plants. The company will also reduce some permanent employees and curtail discretionary spending.
The job cuts follow an announcement last week of a reduction of 500 employees by the end of 2008. Cummins has roughly 37,800 full-time employees.