Dow Chemical to close plants amid cost cuts, cites weak Europe economy
Dow Chemical says it is cutting costs in response to continued weakness in the European economy. 
Actions include closing certain manufacturing plants in Europe, North America and Latin America, as well as canceling a selection of capital projects and implementing workforce reductions.
Dow anticipates that it will save approximately $250 million annually from these actions, it said, noting that the savings are part of the company’s goal to deliver an additional $250 million of cash flow from cost interventions in 2012.
Dow anticipates that approximately 900 positions will be eliminated worldwide, and in the first quarter, Dow will take charges totaling approximately $350 million for asset impairments and write-offs, severance and other costs related to these measures.
“These actions, while difficult, are in full alignment with our commitment to continually manage our portfolio to adapt to changing and volatile economic conditions, as we are seeing particularly in Western Europe, and to preferentially invest in our fast-growing, technology-rich businesses,” said Andrew N. Liveris, Dow CEO.
“Today’s announcement further demonstrates our resolve and ability to take swift, strategic cash flow interventions that will keep Dow solidly on a trajectory to deliver $10 billion in EBITDA in the near term,” he added.
Dow will shut down three plants that produce STYROFOAM insulation products located in Estarreja, Portugal; Balatonfuzfo, Hungary; and Charleston, Illinois; and idle a plant in Terneuzen, The Netherlands.
Dow will also close its toluene diisocyanate (TDI) plant in Camaçari, Brazil.
In addition to these closures, Dow will consolidate certain other assets in its polyurethanes and epoxy businesses, it said, optimizing their operations while remaining focused on meeting customer needs and sourcing through non-impacted assets.
These actions are expected to take place over the next two years.
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