Electrolux said a recent plan to cut jobs in the face of an economic slowdown and rising raw material prices would lead to larger annual savings than first predicted but at a higher initial cost.
Echoing remedies announced by the world’s biggest appliances maker Whirlpool in October, Electrolux unveiled in November, as part of a wider efficiency programme, plans to cut overheads in all regions by reducing staff.
Electrolux said it was booking 630 million Swedish crowns ($91 million) costs for the staff cuts in the fourth quarter, and now expected savings of 680 million per year.
“The annual savings are about 180 million crowns higher than previously estimated and communicated at the capital markets day in November, while costs are about 130 million crowns higher,” Electrolux said.
Electrolux spokesman Erik Sziga said that did not mean the company would cut more staff than previously thought, but rather that preliminary calculations about the savings had been too cautious.