TRW To Cut Jobs, Close Plants

TRW Inc. will eliminate 7,500 jobs, or about 14 percent of its automotive parts work force, and close up to 15 percent of its 137 manufacturing plants in 24 countries to cut costs and become more competitive.

TRW, which has 54,000 workers in its automotive units, hasn't decided where the layoffs will occur but expects American workers and employees overseas to be affected, spokesman Jay McCaffrey said as the cuts were announced Wednesday.

TRW also hopes to save $75 million a year by cutting sales and administrative costs and halving the number of its automotive suppliers. It will cut capital spending by at least $300 million over five years.

"Lean manufacturing will continue to drive our manufacturing strategy, and we will give even higher priority to the implementation of these practices," said Peter S. Hellman, president and chief operating officer.

TRW also makes space, defense, and information technology equipment.

It said the restructuring will reduce profit by up to $150 million before taxes during the next 18 months. About $25 million of the charges will be taken by Dec. 31.

"We are taking these actions to enhance TRW's competitive advantage and profitability in our automotive business," said Joseph T. Gorman, chairman and chief executive. He said the savings expected from the moves should make up for the added expenses within two years and improve cash flow from operations by about $100 million a year.

TRW stock was up 56 1/4 cents at $55.06 1/4 a share in midmorning trading on the New York Stock Exchange following the announcement.