Autoliv to axe 3000 jobs, cut outlook

Font Size

Print

Feedback

Email

Discuss

Related Articles

Job cuts reach into oil sectorJob cuts reach into oil sectorSpain's jobless data hits 12-yr highMitsubishi to cut 2,000 jobs in Japan

Stockholm, July 22: : World number one air bag and seat belt maker Autoliv said on Tuesday it would cut its full-year outlook and shed upto 3,000 jobs in the face of weakening auto markets and soaring raw material costs.

Shares in Autoliv, which reported second-quarter earnings just below expectations, fell 1.8 per cent to 267 crowns, but still outperformed a 3.2 per cent decline in the Stockholm bourse's blue chip index.

"The market outlook is deteriorating as a result of both accelerating production cuts by customers and accelerating raw material and energy costs," the company said in the report.

The company said it would carry out a programme to push through savings of about $120 million. The scheme would cost up to $75 million to implement, it added.

Autoliv said quarterly pretax earnings rose to $135 million from $89 million a year earlier, to come in below the mean forecast of $139 million seen in a Reuters poll of 11 analysts.

Earnings at the group, which is based in Sweden but which reports in dollars, were boosted by a weaker dollar as profits accrued in Europe, its biggest market, were translated into the US currency at a more favourable rate than a year earlier.

But Autoliv has faced weak demand in its biggest markets in recent months, not least in the United States where a deepening financial crisis and economic slowdown has hurt car sales.

"As a result of the negative market trends, the company is changing its full-year guidance. Sales for 2008 are now expected to increase by 8 per cent and an operating margin, excluding severance and other restructuring costs, is expected in the range of 7-7.5 per cent," the group said.