Adient, a prominent automotive seating company, recently revealed its restructuring strategy within Europe. The primary objective is to lower operating, management, and engineering costs. They aim to achieve this predominantly through reducing their workforce and outsourcing tasks to regions with lower labor costs.
For the second quarter of the fiscal year 2024, Adient anticipates that it will record a restructuring expenditure of approximately $125 million, almost entirely due to employee severance benefits within Europe. The company predicts that future cash expenditures will closely mirror this figure.
It's important to note that the majority of these restructuring actions in relation to these specific plans are scheduled to take place in the fiscal years 2025 and 2026. They are forecasted to conclude considerably by the fiscal year 2027.
Upon successful completion of these plans, Adient projects an approximate reduction of $60 million in annual operating expenses stemming from these actions. About 80% of this figure is forecasted to result in net savings.
