Johnson Controls uses layoffs to produce cost reduction

Global technology firm Johnson Controls Inc. announced that it will engage in layoffs at its corporate headquarters in Glendale, Wisconsin, in order to generate cost reduction.

The company did not specify how many positions it will eliminate, and the layoffs were prompted by dropping sales and profits at the global technology firm, according to The Milwaukee-Wisconsin Journal Sentinel. The global technology firm provided earnings in January that fell short of expectations, and warned that both sales and profits generated during this fiscal year would not be as high as predicted in October.

Johnson Controls predicted that its annual sales for the fiscal year ending on September 30 would total $43.5 billion, compared to the company's earlier forecast of $44.2 billion, the media outlet reports. The company generated $40.9 billion in sales during the previous fiscal year. The company will release its results for the second quarter of its fiscal year on April 20, and plans to update its guidance for sales and earnings at that time.

The global technology firm stated at the time that sales of York-brand furnaces and lead-acid batteries both suffered in the calm winter months, according to the news source. The company stated that it was also coping with increased cost pressures stemming from a decision by the Chinese government that prevented the company from opening a battery factory.

Spokesman Fraser Engerman stated that most of the individuals who will lose their jobs were notified on Monday, April 2, but that some were told about the situation on the previous Friday, which was March 30, the media outlet reports.

"Due to business reasons and continued financial challenges Johnson Controls faces in 2012 and into 2013, the company has decided that it's necessary to continue cost-reduction efforts by reducing the corporate head count," Engerman stated, according to the news source.

Engerman stated that the global technology firm's three businesses will be engaging in layoffs in order to realize further cost reductions, the media outlet reports. The company spokesman did not indicate if Milwaukee-area workers would be at risk of losing their jobs as a result of layoffs affecting the building efficiency business or the power solutions business.

Further cost reduction efforts made by Johnson Controls were revealed recently, when Emerson Electric Co. announced that it has acquired Johnson Controls Inc.'s marine container and boiler business, according to The Associated Press.