Posted on 10/09/2012 4:27:11 PM PDT by blam
China Slowdown Leads To 1,500 Job Losses At US Engine Company — Stock Tanking
Joe Weisenthal
Oct. 9, 2012, 5:24 PM
This is exactly what you don't want to see. A major industrial company announcing a slowdown due to China and layoffs in the US.
The company is Cummins Engine. The stock is off over 6% after hours, and the company is laying off up to 1500.
We'll note that this story of declining global growth hitting domestic US manufacturers is a big one that we've been talking about for awhile.
This explains why in recent months -- despite the secular upturn in manufacturing -- the industry has actually shed jobs.
As you can see, the industry has lost jobs in both September and August.
The full announcement is below.
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Cummins Inc. (NYSE: CMI) today lowered its full year revenue and EBIT guidance for 2012 and also announced actions to respond to the weakening global economy.“Taking these actions now will allow us meet customer needs, maintain strong financial performance and allow us to capitalize on future growth opportunities.”
The Company lowered its full year revenue outlook for 2012 to approximately $17 billion compared to the Company’s previous guidance of $18 billion. Earnings Before Interest and Taxes (EBIT) are now expected to be approximately 13.5% for the year, compared to prior guidance of 14.25% to 14.75%. Based on preliminary results and subject to normal quarterly financial statement closing procedures, third quarter revenues are expected to be approximately $4.1 billion and EBIT is expected to be approximately 12.0%. The Company does not provide quarterly revenue or earnings guidance.
“We continued to see weak economic data in a number of regions during the third quarter increasing the level of uncertainty regarding the direction of the global economy.
(snip)
(Excerpt) Read more at businessinsider.com ...
Indiana was already a Romney State. Now it’s a lock.
Pay attention to plan shut-ins and closures in China. The word is slowly leaking out - the Chinese see a huge over-capacity of production for the current world market.
I don’t know if you saw this, but the PRC has shut-in a large plate steel plant:
Steel plants don’t like being shut down and start back up. It’s a huge cost to bring them back online...
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