You heard it from here
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I get that CTC may be seen as sales for their vendor. The thing is, I don’t care about the vendor. I just want to get all of you BUs into a single system so my group can stop having to support 7 different tools and lower costs. Exxon does this standardization and it’s a big reason why their costs are so much lower than ours in benchmarking.
I agree so much with the person who said CTC are just salesmen for their favorite vendor . So true. I have not seen the ETC or CTC actually add any value.
I don't see many openings in ENGINE for core petro-tech (geology & geophysics) jobs yet, which represents a significant part of CTC, but maybe I just have my head in the sand.
Considering the fact that we are offshoring AND centralizing; I think any guess you guys are giving on the percent in ctc is pure speculation. Bus WILL literally shrink. Bu tasks outside of ops are going offshore and to center. Center jobs are going offshore, but also pulling in from bu and likely downsizing or deleting certain groups. All groups will be looking to delete or combine positions. I do think half of the ctc positions could be outsourced to engine, this will take years to accomplish (as it did for xom, as it is going with no). I’ve been through to many of these with cvx, I want to be hopeful that the changes will help. But……
All the other majors are doing the exact same thing. You would think at this point they could take turns with the consultants and just share the recommendation.
Real questions are: does Hess go through and if so what do we keep, do we keep certain business units, do we hit on the exploration campaigns, etc.
At least 45%. That’s what I heard
No surprise. EB was supposed to rejuvenate CTC, but all she did was feather her nest for the CEO job, CTC has languished the last five years.
@dt I did not intend to imply the processes would be changed and improved when the work is moved to India, but if there are a large percentage of employees in the US laid off then the processes won't be done in the USA anymore so changes will be made because the LT wont know what processes to take without their employees. :)
I completely agree with your statement, "People in the US have been fighting to improve processes for decades. The issue isn’t the US workers, it’s the US leaders unwilling to give up their empires and influence." This is why the layoffs will only decrease cost but not make the improvements the ELT want to achieve. Same LT, same problems....
Honestly could cut 100% of CTC…top to bottom
If you think the processes will be changed once ENGINE takes over I’ve got a bridge to sell you.
People in the US have been fighting to improve processes for decades. The issue isn’t the US workers, it’s the US leaders unwilling to give up their empires and influence
For the person who stated, "Isn't ENGINE just targeting 600 news employees? How is that replacing 30% of CTC?", the 600 employees in the ENGINE is hiring in 2025. Chevron's goal is to layoff the US employees in 2025 to take the financial deductions in 2025, then realize the cost savings in 2026. The US employees will be replaced with MSP and contractor resources during the interim until the Engine, Manila and Argentina can be ramped up over the next 3 years. The US employees are a cost burden that Chevron wants to remove by the end of 2025. When you read the future slides and listen to the ELT, there is a bullet point stating, "Change the way we work and where we work". There are a lot of processes have never been improved and will be changed once the US employees are no longer performing the work the old "inefficient" way. I believe we all see projects and work identified by middle management that is not bringing value at the ROCE (Return on Capital Employed) of 12%. If they can get rid of work that is below 12% ROCE, then there are projects that do not need to be performed.
I’ve heard that is closer to 70%. They need to get it over with
No.. you got it backwards. The 30% is what's left after the re-org and layoff.
Any news about the hiring of technical jeets in India? I've been hearing it's not working out.
I sent Biden appointed Lian Khan a box full of fraudulent documents concerning my lawyer brothers and siblings defrauding of my inheritance of mineral rights in Colorado. This should have prompted an investigation particularly in the Chevron//Hess merger. I’ve heard nothing except the merger went through right before Khan and Biden left office. Biden has said Chevron had more money than God. Was he putting his finger on the scale?
It may be a 30% cut across CTC but Chevron is currently increasing headcount in 3 offshore locations. Layoffs will need to be much higher than 30% in the US to reach a 30% cut for CTC.
Total remuneration and total cost are different things. Total cost includes TR plus office, equipment, travel, HR support, etc etc. It all adds up to around $500k per employee.
I’ve honestly never heard of a CTC “win”. Our team dreads getting them involved
@bx+1jjb2yjry Your total comp numbers are WAY off. And the cuts will be high cost location centered (US, ABU, UK - Canada mostly gone already) so those countries will see a higher percentage cut, while Argentina, Manila grow and Engine starts up.
Seems 70% too low
My experience with CTC SME's is that they are sales people for their personal favourite vendors. The true experts are long gone.
@c4+1jjb2yjry: People think CTC is full of experts. The number of smes in ctc is very low and will soon we lower. You’re talking 20-30 people globally.
CTC too large and a drain on BU resources. We don't need all the so called experts, give the good ones,there are a few BU jobs. The remainder show the door.
You are including low COL location employees and contractors in that total. There are 7000 people in Houston and 2000 in San Ramon, fewer than 1000 each in Covington, Richmond, LA. That's all per Chevron 2024 press releases announcing HQ relocation. You think the cuts will be evenly distributed across US and Phillipines/Argentina? Of course not - in fact, on pure Opex if you assume that some of the work is going to be offshored, you need MORE than 5000 cuts since you incur a (much smaller) salary in India or whatever. Your total cost is also wrong. All in annual cost of a PSG 22, which is the median US employee, is 284k including benefits and employer SS contribution.
I also heard 1100%, and if they really don’t like you, they’re taking your dog or first born as well.
CVX has 40,000 employees Dec 2023 NOT including about 5,000 service station employees. Ave total cost including benefits is $500,000k so $1.5 billion savings implies 3000 cuts which is 7.5%. Nice try, though.
CTC could be as high as 10% except remember CTC was the entire reason for the JG 2020 Transformation (resizing CTC to match the reduced number of BUs when several were closed/sold/lost), so it could be lower.
I think everyone working in a group of 10 or more can think of at least one person that the group could survive without so no big deal. Oh, and if you can't think of the weakest link in your group that is probably because it is you.
Way too low. I heard they were targeting a minimum of 1100% cuts.
What does ctc encompass? What role titles
Isn't ENGINE just targeting 600 news employees? How is that replacing 30% of CTC? Of those 600, you have many different disciplines being hired, targeting jobs in all OpCos. You'll need multitudes more people in ENGINE if you want to replace 30% of CTC. That'll take many years, if it can be done at all.
When? Do they have ENGINE replacements?
That's total...US is more like 50-55. You heard it here first.
Not enough!
I don't know why people are confused about this. You don't get to 1.5 B in structural Opex reductions without cutting at least 5,000 people. Chevron has like 20k US employees not counting service stations. You have to figure another few thousand are critical asset level support. So 30% should be your base case unless you are in an easily outsourced function like IT and finance or your in one of the few growth BUs.
Downstream / Manufacturing had a 35% implied target for 2025 headcount reduction. That's actually the opex line reduction, so it's would end up being fewer people if more senior high PSGs are let go. But yes, sounds like all divisions have roughly the same 30% target and we just have to wait for Mike to kick the whole thing off.
Old news! It was already a known number back in October 2024
I’ll be shocked if it’s that low. But at least in IT there’s already been a lot of attrition so maybe they don’t have to cut as deep
Are you sure that’s all? I heard more in the US.