Cummins to reduce worldwide workforce by 500 jobs

The employee reductions at Cummins will come from all parts of the company. In order to minimize the impact of involuntary employment actions, the company said it has decided to offer a voluntary retirement package to certain active professional employees in the United States.

The Trucker News Services

12/5/2008

COLUMBUS, Ind. — Cummins Inc. will reduce its professional workforce worldwide by at least 500 employees — or approximately 3.5 percent – by the end of 2008 as a result of the continued deterioration in the U.S. economy and many other key markets around the world, the company said Friday.

The employee reductions will come from all parts of the company. In order to minimize the impact of involuntary employment actions, the company said it has decided to offer a voluntary retirement package to certain active professional employees in the United States.

Those employees being offered a chance to participate in the program will have until Dec. 11 to accept the compensation packages, which include salary and continuation of benefits, including health care, for nine months following their retirements.

The remainder of the reductions will be involuntary, according to a Cummins statement. Employees affected by these job actions will, in most cases, be notified by Dec. 18 and the reductions are expected to take effect by Dec. 31.

“Cummins already has taken a number of actions across the company to try to bring costs in line with our reduced current demand and to meet the expected challenges of 2009,” said Cummins Chairman and Chief Executive Officer Tim Solso. “Despite those efforts, we have now reached a point where we will have to take more significant steps to reduce our professional workforce around the world.”

Cummins has deployed its “rings of defense” approach to reducing costs at manufacturing and logistics locations worldwide, which includes temporary plant shutdowns, shortened work weeks and extending traditional holiday closing periods; eliminating some overtime; and previous job cuts.

“These are difficult times, but in many ways we are better positioned to weather a downturn than at any time in our history,” Solso said. “We are committed to doing what is necessary to emerge from this downturn a stronger company and resume our recent history of strong growth once our markets begin to improve.”

Cummins Inc. designs, manufacture, distribute and service engines and related technologies, including fuel systems, controls, air handling, filtration, emission solutions and electrical power generation systems.

Kevin Jones of The Trucker staff can be reached for comment at kevinj@thetrucker.com.