The unprecedented market disruptions created by the coronavirus pandemic have prompted Dow to streamline operations and maximize efficiency by shedding uncompetitive assets, laying off 2,000 jobs, and delaying new capital projects. However, the company executives said the measures were in line with Dow’s long-term plans since the spinoff from DowDuPont in April 2019.
Dow revealed the restructuring and other cost-cutting plans in its latest quarterly earnings call when it expected a prospect of a gradual and uneven recovery. Dow also said it would cut opex further from $350 million to $500 million this year. During the call, CFO Howard Ungerleider said the job reduction would be spread relatively evenly across businesses and geographies.
Previously Dow announced that Watco acquired its North American rail assets for $310 million under a plan to divest non-producing assets, but Ungerleider said it was unrelated to the COVID-19 pandemic. Ungerleider noted that Dow could use the money and reinvest it in research and developments ot in product-producing assets.
