Tips:TTFnews:Sikorsky Aircraft, a unit of United Technologies Corp, on Tuesday said it would cut 1,400 jobs and consolidate facilities, with lower oil prices sharply reducing demand for helicopters in the oil and gas sectors, and international military orders down.
Sikorsky spokesman Paul Jackson confirmed the job cuts, in which workers and the company's unio were notified earlier Tuesday, but said the move was not related to the parent company's ongoing review of strategic options for Sikorsky.
"Today's announcement is based on the current challenging market conditions and is independent of United Technologies' ongoing review of strategic options for Sikorsky," said spokesman Paul Jackson. "The two are completely unrelated."
Reuters reported last month that Airbus Group, Boeing and Lockheed Martin Corp were exploring options for a deal, although a steep US$3 billion tax bill associated with an outright sale was dampening interest.
Potential bids were due on Monday.
United Technologies also shook up Sikorsky's management in April, naming Robert Leduc to succeed Mick Maurer as the company's president.
"Sustained decreases in oil prices continue to drive significant declines in capital investments by oil companies in offshore oil exploration projects impacting Sikorsky and resulting in reduced production levels," Jackson said.
He said demand for certain international military products had also dropped.
United Technologies in April cited pressure in the oil and gas sector as it reported an 11 percent dro in Sikorsky's first-quarter operating profit and a 7 percent decline in sales.
A huge chunk of Sikorsky's nonmilitary business is for oil industry customers shuttling workers and equipment to offshore rigs. Efforts by energy companies to reduce expenses due to the dro in oil prices are rippling through the helicopter industry.
The company told workers and the Teamsters unio that the job cuts would affect Sikorsky's facilities in Poland, Pennsylvania and Connecticut, and would take place over the next twelve months starting immediately.
The layoffs will affect 342 Sikorsky employees and 560 contractors in the United States, as well as 510 workers in Poland. The company has a total workforce of around 15,300.
It told employees it planned to vacate smaller satellite facilities and consolidate remaining production into larger sites in Poland, Pennsylvania, and Connecticut.
The company said it would also close its current facility in Bridgeport, Connecticut, and move workers to its Stratford, Connecticut facility.
