NEW YORK (Reuters) - Car interiors maker Johnson Controls said it would close 10 plants as it expects no near-term recovery in global auto production.
The company will take a pretax charge of up to $215 million in the second quarter ending March 31, partially offset by about $75 million in one-time tax benefits. Johnson Controls said it still expected to return to profitability in its third and fourth quarters.
The Milwaukee-based company forecast vehicle production this year at 8.8 million units in North America and 14.3 million in Europe.
North American production in the March quarter was the lowest in 27 years on an annualized basis, the company noted. Its January forecast called for 9.2 million vehicles in 2009.
The bulk of Johnson Controls' charges are in the segment that makes seats, doors and control panels for vehicle interiors.
This segment accounted for 48 percent of the company's sales in 2008, but 28 percent of its earnings. About half its sales come from Europe, with North America accounting for about a third and Asia the rest.
Johnson Controls, which also makes building efficiency systems and batteries, did not immediately say how many jobs it expected to cut as part of the restructuring.
"While we don't expect near-term recoveries in our markets, we believe we can manage through this environment from a position of strength," Chief Executive Stephen Roell said in a statement.
At the end of 2008, Johnson Controls announced a $495 million restructuring program with cost cuts. It said these were about two-thirds complete and ahead of schedule, and benefits would affect results in the third quarter.
The company expects to complete the latest round of restructuring in 2010, and does not anticipate taking any more such actions in the foreseeable future.
Johnson Controls said it would report second-quarter results on April 21.
Its shares, which closed Thursday at $12.90, have lost almost two-thirds of their value since hitting a 52-week high in May.
(Reporting by Christopher Kaufman and Nick Zieminski; Editing by Derek Caney and Lisa Von Ahn)