Textron announces 2% global workforce reduction

In a regulatory filing, Textron said, “On November 28, 2023, the Board of Directors of Textron approved a restructuring plan developed by management in connection with the company’s annual operating plan process. The plan will reduce operating expenses through headcount reductions at the Industrial, Bell and Textron Systems segments. In the Industrial segment, the plan includes headcount reductions at Textron Specialized Vehicles, resulting from lower demand for certain of our powersports products which we anticipate will continue, and at Kautex, due to reduced demand for fuel systems from European automotive manufacturers. In both the Bell and Textron Systems segments, the plan includes targeted headcount reductions to improve the segments’ cost structures and realign their workforces as these segments transition from legacy production contracts to more development, engineering focused contracts. Collectively, these actions are expected to result in the reduction of approximately 725 positions across the impacted segments, representing 2% of our global workforce. The restructuring plan is also expected to result in impairment charges related to both fixed and intangible assets within the powersports product line at Textron Specialized Vehicles and fixed assets at Kautex, resulting from lower planned production levels due to the impact of lower demand, which we anticipate will continue. In the fourth quarter of 2023, we expect to incur pre-tax special charges related to this restructuring plan in the range of $115 million to $135 million. We estimate severance and related costs to be in the range of $35 million to $45 million, and asset impairment charges to be in the range of $80 million to $90 million. We anticipate annualized gross cost savings of approximately $75 million upon completion of the restructuring plan. Cash outflows for this restructuring will occur primarily in 2024 and are estimated to be in the range of $35 million to $45 million. We anticipate that this plan will be substantially completed in the first half of 2024.”