Lear Corp. is preparing for a potential economic downturn by continuing to cut headcount and consolidate manufacturing plants, executives said Tuesday, as the seating and electronics supplier reported second quarter net income plunged by 60 per cent.
"I feel like we've been, particularly the supply base, in a recession for two year ...," Scott said Tuesday on a call with investors."Since the beginning of COVID ... we had been taking advantage of the downturn to focus on strengthening our product portfolio, our talent and our balance sheet." It said in May it cut headcount by 7,700. On the Tuesday earnings call, Scott said Lear would consolidate manufacturing operations in Mexico and Morocco after doing so successfully in South America.
"As far as the collaboration , it's much more permanent and fixed within the price going forward," Scott said."De-risking the copy is something that we take as a priority to make sure that we're getting the contracts updated to the increased cost pressures that we're seeing." Lear CFO Jason Cardew said the company's actions to reduce SG&A expenses will result in annual savings of $35 million to $40 million.