Dow to cut 2,000 jobs in evaluation of 'global asset base'

Materials giant Dow Inc. is cutting 2,000 jobs as part of a cost-savings plan.

Midland, Mich.-based Dow announced the moves Jan. 26, the same day it released fourth-quarter and full-year 2022 financial results. Officials said in a news release the proactive actions "will further optimize (Dow's) cost structure in response to near-term macroeconomic uncertainty, while maintaining its long-term competitiveness across the economic cycle."

The job cuts are part of $500 million in structural improvements that also includes "shutting down select assets, while further evaluating Dow's global asset base, particularly in Europe, to ensure long-term competitiveness."

Dow also plans $500 million in operating expense reductions for a total of $1 billion in cost savings in 2023. Those reductions will include decreasing turnaround spending, reducing purchased raw materials, logistics and utilities costs, and aligning spending levels to the macroeconomic environment.

"We are taking these actions to further optimize our cost structure and prioritize business operations toward our most competitive, cost-advantaged and growth-oriented markets, while also navigating macro uncertainties and challenging energy markets, particularly in Europe," Chairman and CEO Jim Fitterling said.

He added that Dow "remains committed to capitalizing on our long-term growth opportunities in a disciplined and balanced manner…these actions further position us to advance our 'Decarbonize and Grow' strategy and strengthen our competitive position."

Dow will record a charge of $550 million to $725 million in the first quarter of 2023 for costs associated with these moves. Those costs primarily include severance and related benefit costs; costs associated with exits and disposals; and asset write-downs and write-offs.

For full-year 2022, Dow reported sales of $56.9 billion, up 3.5 percent vs. 2021. But the firm's net profit—not counting a provision for income taxes—declined almost 28 percent to $4.64 billion.

Dow is one of the world's largest producers of polyethylene and specialty resins. The firm employs almost 36,000 worldwide.