Dow Chemical Announces Job Cuts After Closing Corning Deal
MIDLAND, MI – The Dow Chemical Co. (Dow) announced global workforce reduction targets of 2,500 positions, including approximately 700 jobs in the Great Lakes Bay Region. The cuts are in response to Dow assuming full control of Dow Corning Corp. earlier this month and its planned merger with DuPont. The company expects approximately $500 million in combined run rate annual synergies as a result of the restructured ownership of Dow Corning.
“With the difficult but necessary actions Dow is announcing today to enable faster and more efficient growth from Dow Corning, we are also calling into action multiple efforts to minimize the economic impact on the Great Lakes Bay Region,” said Howard Ungerleider, Vice Chairman and Chief Financial Officer of Dow, and Chairman of Dow Corning. “We believe, by working together as one community with one singular focus, we can make both Dow and the region stronger and more economically resilient in the future.”
The company will begin notifying employees in the coming weeks, with notifications continuing through the end of the third quarter of 2016. Roles will be eliminated on various timetables throughout a two-year integration period. Dow will work with state and local community organizations to spur employment and economic development in affected areas.
Since January, Dow has implemented a hiring slowdown of external experienced hires, which has resulted in a number of open roles. As the integration process proceeds, Dow intends to prioritize impacted Dow Corning and Dow talent for selection into these open roles to minimize the impact of job loss.
The company also announced an updated facilities plan. Dow will shut down silicones manufacturing facilities in Greensboro, NC, and Yamakita, Japan, as well as certain administrative, corporate and manufacturing facilities to further enhance competitiveness and streamline costs associated with the transaction. Construction of Dow’s new corporate headquarters building will continue as planned, with a scheduled opening at the end of 2017.
The company will take a charge of approximately $410 million to $460 million in the second quarter of 2016 for asset impairments, severance and other costs related to these measures, which are expected to be completed in the next two years.