Bayer streamlining includes global shutdowns, layoffs

LEVERKUSEN, Germany (Aug. 15)—Bayer A.G.´s polymer division is reducing its global workforce by 1,800 and closing 15 production plants as part of a package of measures to save the group more than $1.3 billion annually within four years. Polymer activities will bear the brunt of the cuts, with Bayer expecting $630 million in annual savings from the division by 2005, Werner Wenning, Bayer´s chief financial officer told a recent analysts´ conference in London. The polymer division—which includes the synthetic rubber and polyurethanes businesses—accounts for almost 40 percent of Bayer´s overall sales (more than $10 billion in 2000) and employs about 36,200, according to company data. The company did not disclose at this time specifics regarding which plants are targeted. Despite the cost reduction measures, Bayer considers polymers a "core" business and has budgeted $1.6 billion in investments globally this year for polymers. Bayer has forecast polymers will achieve a return on sales of 15 percent by 2004, despite the current economic climate. Bayer claims world leadership in sales of synthetic rubber and PU raw materials. Bayer is gearing up for the Sept. 26 debut of its stock on the New York Stock Exchange.