Whirlpool, the parent company of renowned appliance brands like Maytag and Amana, is slashing approximately 1,000 salaried positions globally in response to sluggish demand in the US home appliance market. The company has already executed the initial phase of layoffs among office staff and is preparing for further reductions, according to statements from chief financial officer Jim Peters. Whirlpool’s total workforce stood at 59,000 employees worldwide at the close of 2023.
Cost-cutting measures
Whirlpool aimed to streamline its operations to reduce expenses by approximately US$400 million this year. However, the endeavor is encountering challenges due to escalating costs for labor, transportation, and logistics, with inflation remaining a persistent factor.
Decline in sales
Sales of large appliances in North America witnessed an 8.1% decline in the first quarter compared to the previous year, as revealed by Whirlpool’s recent announcement. The company’s revenue for the period amounted to US$4.49 billion, falling short of analysts’ projections.
Shifting market dynamics
The subdued demand for new refrigerators and washers correlates with sluggish existing home sales in the US. Nonetheless, Whirlpool perceives a shift in consumer behavior towards home remodelling projects, potentially driven by the availability of home equity for renovations.
Strategic adjustments
In response to the evolving market landscape, Whirlpool is recalibrating its product offerings by reducing discounts on large appliances and expanding its portfolio to include smaller countertop appliances such as KitchenAid stand mixers and battery-powered blenders. Additionally, the company is venturing into new territory by introducing fully automatic espresso makers, aiming to capitalise on more profitable product segments.