After major loss reported for 2nd quarter how many more lay offs can we expect in 2016?
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Chevron is structurally inefficient. Industry benchmarking shows Chevron needs 15000 more job reductions to be as efficient as best in class ExxonMobil. ExxonMobil is not standing still either, I understand it's headcount will be under 70,000 in two years. Chevron needs many BUs consolidated or eliminated or sold, with many layers of management removed. Also, many higher level, highly paid positions removed and petrotech salaries reduced to be more equivalent to the petrochemical industry. You can count on 20% more overhead cuts across all salary grades combined with low to no salary growth for those who survive the cuts. Of course, A few top managers will be compensated highly.
No layoffs in large numbers this year. The 8000 number has largely been met across the span of global operations. Minor cuts distibuted across CNAEP BUs or acceleration of post-ROM/ESP sunset terminations more likely. Focus now on cutting opex. Leadership reframing to address likelyhood that significant price recovery not likely till 2017-2018. Next year another matter altogether. If prices stay low, as seems likely, we approach a severe negative accounting condition as the quarterly losses accrue and the annual 8 billion dollars is allocated to pay dividend. Expecting our bond rating to be lowered again in 2016 and that makes borrowing via bond issues even more costly. Layoffs are just a sympyom of a deeper issue: can Big Oil's business model be sustained in low price world? 2018 will be the turning point one way or the other and this time next year we will all have a pretty good idea which path lies ahead.
What is over 9000? Link please
Yes, once the company abruptly shows you the door, Security will SAFELY escort your crying @ss to your car and see you off the premises.
Remember, now! SAFETY is your primary concern!
It's OVER 9000!
Houston, TX - Enclave Area
Job Code: 20008351
Just posted
Chevron keeps pushing back its "new centralized" buisness model. U.S. BU'S run out of Houston. The price collapse and will push the inevitable ahead faster.
Total loss is $1.94 billions, they are playing with the numbers, they should not account the $491 millions in asset sales in total revenue in income statements. The asset sales should be accounted in the statement of cash flow to is part goes into the balance sheet.
"Cut costs aggressively" means "cut personnel aggressively". Until we reduce the dividend sufficiently or we're lucky enough (don't hold your breath) to see a drastic turnaround in oil prices, there will be more layoffs. Sad, but true.
Layoffs are not normally mentioned in the earning press release. Wait for the conference call later this morning....
I was surprised there was no mention of layoffs in the presentation to investors. Although they did say one key focus will be to "cut costs aggressively"