Newspaper article St Louis Post-Dispatch (MO)

Kodak to Cut 10,000 Jobs in Effort to Control Costs

Newspaper article St Louis Post-Dispatch (MO)

Kodak to Cut 10,000 Jobs in Effort to Control Costs

Article excerpt

Eastman Kodak Co. said Wednesday that it will cut 10,000 jobs by 1995, freeze research costs and take other austerity steps to help save $2.8 billion.

The leading maker of photography products, famous for its yellow boxes of film, became the latest big U.S. industrial enterprise to slash staff and spending in order to improve profitability in a slow economy.

But analysts who follow the company said the job cuts, which amount to about 9 percent of Kodak's global work force, must go deeper and happen faster.

The reductions were announced by outgoing Kodak Chairman Kay Whitmore, who lost his own job earlier this month, fired by by board members dissatisfied with his efforts to reduce costs.

The plan outlined Wednesday was the same one that resulted in Whitmore's ouster, said R. Jackson Blackstock, a securities analyst with First Boston Corp.

Kodak, which plans to replace Whitmore with an executive from outside the company, probably will hire someone who will make more drastic cuts, Blackstock said.

"The Whitmore restructuring plan is not going to be implemented because Kay Whitmore is not going to be there," Blackstock said. "The board felt his plan was insufficient, so by inference you can figure the cost-cutting is going to be deeper."

Company spokesman Ron Roberts said that Kodak's board had approved Whitmore's cost-cutting plan but that whoever replaces Whitmore might make changes. Whitmore is staying on until his replacement is chosen.

"There's every intention to go forward with these things," Roberts said. "Whether the new guy will come in and make changes, additions, subtractions to the plan, I don't know."

Whitmore said the job cuts would be in addition to 2,000 jobs eliminated early this year, mostly in Rochester, N.Y., where Kodak has its headquarters.

"Kodak is not a company in crisis," Whitmore said in a letter to shareholders. "At its core, Kodak remains a very strong company and intends to become stronger."

The job cuts will be spread throughout the company's w115,000 people worldwide. Company spokesman Paul Allen said the reductions would come through layoffs, attrition and possibly the sale of subsidiaries. …

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