DETROIT -- Automotive technology supplier Visteon Corp. plans to cut jobs over the next two years as the coronavirus pandemic recession continues to infect the company's bottom line.
Visteon did not reveal the exact number of possible job cuts, but the maker of instrument clusters and other cockpit technology expects $35 million to $40 million in cash payments for termination, severance and retention until the end of 2022.
Visteon's board approved the restructuring plan Sept. 30, according to a regulatory filing with the U.S. Securities and Exchange Commission.
Asked for more specifics about the restructuring plans, a Visteon spokesman referred back to the regulatory filing.
"As noted in the 8-K, our restructuring program is global in nature and will further rationalize our footprint to respond to current economic events and lower industry production volumes," the spokesman said in an e-mail. "We have no further comment beyond that.”
Visteon, based in suburban Detroit, currently employs roughly 10,000 at more than 40 locations in 18 countries.
The company, which originally spun off from Ford Motor Co. about 20 years ago, has been shrinking for several years, spending much of the previous decade paring off business units. Visteon had more than 26,000 employees in 2012 before it sold its climate-control business to a joint venture, then its interior unit to a private equity firm and its electronics unit to what was then Johnson Controls Inc.
Visteon's revenue plunged from $5.8 billion in 2012 to $1.7 billion in 2013. It has since been able to increase sales in its current business lines, reporting revenue of $2.95 billion in 2019.
But the coronavirus-induced recession hasn't been kind to Visteon.
In the first quarter of the year, Visteon reported a net loss of $335 million on revenue of $643 million, though $33 million of that loss was attributed to restructuring. During the quarter, Visteon temporarily shut down several plants, reduced employee salaries by 20 percent and started drawing down on a $400 million revolving credit line.
Visteon's sales dropped by nearly half in the second quarter as it reported another loss, this time of $45 million, as production for its top customers bottomed out down 53 percent compared with a year earlier, according to its second-quarter earnings presentation. The company said it planned to eliminate 10 percent of global salaried headcount at that time.
But the likely expanded headcount reduction is in response to the recession's long reach despite strong auto sales and production in the second half of 2020. Visteon secured $1.7 billion in new business in the first half of 2020, significantly down from $3.2 billion in the first half of 2019. And with expectations of year-over-year production to be down 15 percent or more, Visteon is shedding jobs as the recovery will likely be long.
Visteon ranks No. 69 on the Automotive News list of the top 100 global suppliers with worldwide sales to automakers of $2.95 billion in 2019.