Debt-ridden International Harvester Co. said yesterday it would lay off 1,200 white-collar employes by the end of September as part of the cuts it plans in its organization. But the company left salaried employes in its Chicago headquarters and elsewhere in suspense by not specifying which jobs would be cut.
"Through this action, we intend to improve the timeliness of decision-making with fewer organizational layers and a wider span of control for key executives," Donald Lennox, IH president and chief operating officer, said.
Last week, the company announced plans to reduce its size as a way of supporting its beleaguered finances and centering its operations on businesses that offer a better chance of leading it back to profitability. As many as 8,000 hourly workers would be laid off in the reorganization, which is being considered by the company's bankers.
The plan would leave the company with as few as eight North American plants, down from the current 23 facilities, and would concentrate its business on farm tractors and trucks, abandoning the money-losing construction equipment field.
Corporate reorganization was the reason for the reduction in U.S. corporate and group staffs announced yesterday, said IH spokesman William Colwell. "When you have a smaller company--you're consolidating manufacturing plants, you're consolidating organization--you need fewer staff-support personnel."
The cuts in white-collar personnel will leave the company with about 12,000 salaried employes, down from 17,600 a year ago. Harvester estimated that laying off 1,200 management workers would reduce costs next year by $50 million. The company said last week its losses in the fiscal year ended Oct. 31 could total $1 billion, equal to IH's losses in the past two years combined.
Harvester also announced yesterday it had sold its 10 percent interest in an iron mine in Republic, Mich., to Jones & Laughlin Steel, a division of LTV Corp., for an undisclosed amount.