Deere & Co., Moline, Ill., recently announced plans to exit the Homelite consumer products business and restructure its construction and forestry division, cutting 1,975 more jobs as part of an effort to improve financial and operating performance. The actions will result in a pretax charge of up to $240 million, or $150 million after-tax, primarily in the company's fiscal fourth quarter.
The announcement affects consumer products such as blowers, trimmers and chain saws marketed by Deere under the Homelite brand. The company's line of professional hand-held and portable power equipment for commercial users will continue to be available through its dealer network.
Deere said it intends to sell its 1,200-employee Chihuahua, Mexico, operation and close some or all operations in Greer and Columbia, S.C., and Charlotte, N.C. Approximately 475 employees will be affected beyond the previously announced salaried workforce reduction.
“These decisions are part of a comprehensive strategy aimed at achieving a substantial improvement in our business performance,” said CEO Robert W. Lane. “They underscore our commitment to building an organization that consistently delivers higher levels of profitability and superior shareholder value.”
On a pretax basis, Homelite incurred losses of approximately $70 million in 2000 and $30 million through the first nine months of fiscal 2001.
The company also announced plans to reduce manufacturing and marketing costs in the worldwide construction and forestry division. These plans will reduce employment levels through the elimination of about 300 positions in addition to the salaried workforce reduction previously announced.
The company plans to close a forestry-equipment factory in Bessemer, Ala., and sell or shut down a fabrication operation in Woodstock, Ontario. Other activities in Woodstock will continue.
