Electrolux plans to lay off 1,700 staff globally as part of restructuring measures that will save it SEK500m ($50m) annually in the wake of its earlier move to spin off its Professional Products business.
Back in January the company announced its intention to turn its B2B operation – which is primarily focused on foodservice and laundry equipment – into a separate publicly-listed entity.
It also communicated a plan to sharpen its consumer organisation and accelerate profitable growth by creating four regionally-focused business areas and reorganizing key global functions.
Following a strategic overview that has taken place since those announcements, the company said this week that it had identified opportunities to improve efficiency across both the consumer and professional divisions.
The measures include outsourcing parts of its current manufacturing in Hungary and investing in its Nyíregyháza consumer refrigeration plant.
Electrolux said the streamlining exercise would impact approximately 875 non-production positions globally. Relevant union consultations are expected to take place in due course.
“The activities will more than offset increased ongoing costs related to the separation of Professional Products and result in a more streamlined setup for the consumer business,” the company stated.
Electrolux is also currently carrying out a multi-million pound manufacturing investment program to strengthen competitiveness and drive profitable growth.
As part of this, the company has decided to invest approximately $112m in automation, digitalization and innovation capabilities in its production of high-end refrigerators in Nyíregyháza, Hungary.
Additionally, production of vacuum cleaners and freestanding refrigerators from its Jászberény facility will be outsourced, affecting around 800 production staff.
Together the measures are anticipated to generate additional annual savings of about £52m, with the full effect seen from 2022.