Chemicals and materials maker Dow announced plans Wednesday to shut down several manufacturing facilities to cut its costs as the ongoing COVID-19 pandemic continues to rattle the global economy.
The company recently announced plans during its second quarter earnings on July 23, 2020 to lower its global workforce costs by 6%.
This week, Dow said it also plans to shut down certain amines and solvents plants and some small-scale downstream polyurethanes production plants located in the US and Europe. Dow’s Performance Materials & Coatings business will also shut down several manufacturing assets, including small-scale coatings reactors. The firm’s supply of siloxane and silicon metal in the US, Canada, and Europe will be adjusted to balance regional needs.
“Given the expected gradual and uneven global economic recovery from COVID-19, we announced in July that we are taking necessary actions to continue to optimize our asset footprint, reduce structural costs and enhance the competitiveness of our business over the long-term,” Jim Fitterling, chairman and CEO of Dow, said in the release. “We continue to stay focused on delivering strong cashflow, strengthening our financial profile and maximizing our operational advantages, and we remain well positioned to capture significant growth as market conditions improve.”
Dow’s cost slashing efforts are anticipated to generate EBITDA savings of over $300 million by the end of next year.