Nov 20, 2002 2 min read

STAMFORD, Conn. (AP) – Xerox Corp. said Tuesday it will cut more than 2,400 jobs, or 3.4 percent of its worldwide work force, through a combination of voluntary programs and layoffs in a bid to cut costs and boost efficiency. “For Xerox to continue building momentum in this uncertain economy, we need to accelerate our drive to improve efficiency while delivering competitive products and services to our customers,” said Anne M. Mulcahy, Xerox chairman and chief executive. “Today’s difficult economic challenges require difficult decisions.”

The cuts will result in a pretax charge against earnings of $350 million to $400 million in the fourth quarter.

The charge includes severance costs and about $50 million associated with facility consolidations and closings.

Xerox, a Stamford-based maker of printers and copiers, will preserve its direct sales force and research and development investments, Mulcahy said.

In the past two weeks, the company said it has launched voluntary and involuntary programs in the U.S. and Canada that are expected to reduce employment by more than 2,400 over the next three months.

Work force reductions in Europe and developing markets are dependent on consultations with workers’ councils and other government policies, Xerox said.

Xerox has been hurt by stiff competition, a botched sales force reorganization, sluggish sales and an investigation of its finances that led to a $10 million fine and a restatement. The company announced a turnaround plan more than a year ago that included thousands of layoffs and the sale of billions of dollars in assets.

The restructuring announced Tuesday will contribute to the company’s target of an additional $1 billion in annualized cost savings.

As of the end of September, Xerox’s worldwide employment was 69,900 including 40,900 employees in the United States.

Shares of Xerox were down 8 cents at $7.95 in late morning trading on the New York Stock Exchange.

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