Kickstart: Whirlpool gets smaller

Fresh off selling most of its European business, Whirlpool Corp. is now paring back its global workforce.

The Benton Harbor, Mich.-based appliance maker said April 24 that it began job cuts in March and will terminate 1,000 employees by the time it's done, "in an effort to reduce complexity and simplify our organization model."

Whirlpool has been struggling the past few years, citing higher material costs, slowing consumer investments in expensive appliances and other "macroeconomic volatility," including the war in Ukraine.

Whirlpool saw about $19.4 billion in sales in 2023 and net income of $481 million vs. sales of $19.7 billion and a loss of $1.5 billion in 2022. In 2021, when consumers spent money on home improvement projects during COVID-19 restrictions, the company hit an all-time high of $21.9 billion in sales.

It completed the sale of the bulk of its European business to Turkish appliance maker Arcelik AS April 1.

Home sales and renovations have struggled in the U.S. the past few years — more on that in a bit — which likely played a part in prompting the workforce reduction.

"The last few years have taught us to always be prepared for external surprises, and we are therefore operationally focused on managing our cost tightly and expanding our operating margins," CEO Marc Bitzer said in Whirlpool's annual report.

Speaking of housing and construction rates, there has actually been some gradual improvement in that market despite high interest rates.

The improved construction market was cited as part of the reason for rising PVC resin prices in North America for the past three months. But after a 4 percent improvement in February 2024 compared with 2023, housing starts were up only 1.4 percent for March vs. a year earlier.

"Some of that may be payback from the good start in January and February," Plastics News Economics Editor Bill Wood said in the April 23 Numbers That Matter Live webcast. With no date in sight for the Federal Reserve to start lowering rates, the economy is "not an ideal environment" for spending on big ticket items such as appliances, cars and homes.

In a Numbers Matter Shorts video, (no subscription needed) Bill noted that improved consumer spending data is up mostly due to rent, health care and other "services" rather than manufactured goods.

"Not everybody is doing well," he says.

Our correspondent Kate Tilley in Australia has the story of the country's only ethylene maker — and a major polyethylene producer — shutting down because its industrial properties are valued more highly than the materials it produced.

China National Chemical Corp. has owned Qenos Pty. Ltd. — a former ExxonMobil joint venture — since 2005, but sold it in early April to LAOP BidCo Pty. Ltd., an industrial and logistics property development company.

The company has struggled for a long time due to rising costs and a lack of improvements in the facilities but now, local media reports say, the new owners think it's more economically sound to sell or develop the industrial sites near Sydney and Melbourne.