LyondellBasell Industries AF SCA plans to cut $700 million from its fixed costs by the end of 2010, the company said in an April 8 news release.
The company will close 10 or more manufacturing plants, 20 offices and research and development sites, and cut 3,000 jobs, around 17 percent of its work force.
“Market conditions continue to be extremely challenging, and we are driving hard across all our organizations to enhance our earnings,” said Ed Dineen, chief operating officer of the Rotterdam-based polyolefin supplier. The firm filed for Chapter 11 protection from creditors Jan. 6.
The plan also includes a reduction in contractors approaching 2,000, or nearly 30 percent.
Some plant closures have already been announced, including a low density polyethylene plant in Fos-sur-Mer, France, that employs 80.
“The detailed program identifies actions and time lines, and implementation is well under way as momentum built rapidly throughout the first quarter,” Dineen said in a news release.
“This cost reduction plan is a key part of our effort to offset the current sales volume and margin weakness. It will also be incorporated into the financial projections that will inform our plan of reorganization,” said Alan Bigman, LyondellBasell's chief financial officer.
“We are working toward confirmation of a plan consistent with the milestone schedule set forth in our debtor-in-possession loans,” Bigman added.