Top-Earning Employees at Major Auto Parts Supplier Face Salary Cuts
The cuts apply only to employees making more than $75,000 per year and will remain in place until at least June 30, when the company plans to reassess its needs.
The cuts only apply to employees making more than $75,000 per year. The lion’s share of Van Buren Township, Michigan-based Visteon employees will see a 2 percent reduction, but salaries for top executives and directors will be cut between 7.5 and 10 percent, said Jim Fisher, Visteon director of corporate communications.
The salary cuts will remain in place until at least June 30, when the company plans to reassess its needs, Fisher said.
A regulatory document filed January 22 with the Securities and Exchange Commission said Donald Stebbins, Visteon chairman and CEO, will take a 10 percent salary cut, while CFO William Quigley III and General Counsel John Donofrio will see a 7.5 percent cut.
Fisher said Visteon’s roughly 2,000 Southeast Michigan salaried employees forced to work a four-day workweek and take a related 20 percent salary cut in January will return to a normal five-day workweek and see their salaries returned to normal levels February 1, unless they make more than $75,000—making them eligible for the new cuts.
Visteon has taken many cost-cutting steps in recent months as it expects its full-year 2008 revenue to be down almost 20 percent from 2007.
The supplier said January 13 that it suspended matching 401(k) contributions and employee salary increases for 2009 while cutting other employee benefit programs and reducing new hires.
Those cuts came after Visteon said in October it planned to cut 800 salaried employees globally. Those cuts were expected to be completed in the first quarter and save the company about $60 million annually.
Visteon said it expected to post revenue of $9.1 billion for 2008, about $400 million less than an earlier forecast. The revenue estimate represents a would-be drop of about $2.2 billion, or 19.3 percent, compared with the company’s $11.27 billion of actual revenue in 2007.
Visteon has never posted an annual profit since it spun off from Ford Motor Co. in 2000.
Filed by Ryan Beene of Crain’s Detoit Business, a sister publication of Workforce Management. To comment, e-mail firstname.lastname@example.org.
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