Electrolux is initiating a cost reduction program

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Electrolux is initiating a cost reduction program on the back of weaker-than-expected market demand and weak earnings in the third quarter. “In combination with supply chain imbalances resulting in significant production inefficiencies and increased costs – the company explains – the third quarter earnings for the Group are expected to decline significantly compared to the second quarter 2022 also excluding the one-time cost to exit the Russia market. This has been driven mainly by Europe and North America. Business Area North America is expected to report an operating loss in the third quarter exceeding the loss in the second quarter. Since market demand for 2023 is expected to continue to be weak in both regions, the Board has today decided to initiate a Group-wide cost reduction program addressing both variable and structural costs. The program, which starts immediately, will focus on reducing variable costs, with special attention to eliminating cost inefficiencies in our supply chain and production. The structural cost reductions will primarily take place in Europe and North America”. The cost measures are expected to result in a material positive earnings contribution in 2023.