US Eastman to cut jobs on trade and slower Europe, China growth

HOUSTON (ICIS)–Eastman Chemical is eliminating jobs because of trade disputes and a slowing economy in China and Europe, the company said on Friday.

“We are operating in a difficult business environment and had hoped and expected to see stronger signs of economic recovery by now,” according to a statement from the company.

“Unfortunately, the ongoing US-China trade dispute and the associated economic slowdown in China and Europe have created tremendous uncertainty, which has resulted in reduced demand for our products.”

Eastman did not specify how many jobs would be cut or where the cuts would be made. The Tennessee-based producer said it will manage its costs on two fronts.

“After careful consideration, and based on our view of the economy today, we have decided to delay employee salary increases where they are not already being implemented, except for operator and mechanic roles,” the statement said. “We have also made the difficult decision to implement a modest and targeted reduction in our workforce.”

Eastman’s net profit in 2018 dropped more than 20%, with sales up more than 6%.

In the company’s fourth-quarter earnings release, CEO and Chairman Mark Costa said Eastman “ended the year with a challenging fourth quarter, primarily due to reduced demand for specialty products in China as well as the slow flow-through of higher raw-material costs in an environment of customer destocking beyond normal seasonality”.

Eastman’s stock price dropped to $78.64 at the close on Friday, down 1.2% from Thursday’s close.

Eastman makes rubber additives, acetyls, cellulosic polymers, polyesters and hydrocarbon resins as well as non-phthalate plasticizers.

It also makes polyvinyl butyral (PVB) and its Tritan copolyester.

Al Greenwood contributed to this report

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