Through TheFLY's Eyes: Whirlpool Corporation
from Theflyonthewall.com



















Maytag Repairman Now Unemployed

It’s a move that surprised virtually no one on Wall Street, nor perhaps, on Main Street.

Whirlpool (WHR) announced Wednesday that it would cut 4,500 jobs at the former Maytag washer and dryer manufacturing plants in Illinois, Arkansas, and Iowa, and move production to its Ohio factories. At the same time the company said it will add about 1,500 positions at other Whirlpool locations, resulting in a net 3,000-position work force decline.

The market’s initial response Wednesday to Whirlpool’s news was mild, although it should be noted that trading was very light, in general, as traders awaited the U.S. Federal Reserve’s interest rate decision this afternoon. In early Wednesday afternoon trading, Whirlpool declined 70c to $92.39, General Electric (GEE), parent of GE Consumer & Industrial, dipped 14c to $34.86, Philips (PHG) dropped 24c to $33.68, and Electrolux (ELUXY) rose 40c to $62.55.

Whirlpool, which posted 2005 revenue of $14.3B and a growth rate of 8.3%, said termination and consolidation/relocation costs will total about $135M-$145M.

Citing intense pressure to contain costs due to increased competition from foreign made washers, dryer and appliances, analyst had expected a manufacturing process consolidation from Whirlpool following its purchase of Maytag. The U.S. Justice Department approved Whirlpool’s purchase of Maytag in June 2006.