Allied-Signal Inc. will cut its work force by 14 percent, possibly jeopardizing the jobs of about 2,300 company employees in Maryland.
A spokesman for the company, based in Morris Township, N.J., said the layoffs scheduled for next year are part of a number of actions to reduce costs, improve cash flow, streamline its organization and strengthen its competitive position.
Especially hard hit will be the company's aerospace and automotive divisions, said company spokesman Michael Ascolese.
Most of the company's Maryland employees work in aerospace-related fields. The company employs 1,400 in Towson at its Bendix Communications division, which makes aviation products; 800 in Columbia at its Bendix Field Engineering unit, which provides support services for aerospace; and 100 in Columbia at the Aerospace Technology Center, which supports the aerospace businesses.
Ascolese said the company has not determined how many jobs will be cut at each of its facilities.
Allied's last major layoff in Maryland occurred in February when 250 workers were let go at the Bendix Communications division when the Air Force canceled a contract to develop a new electronic system for identifying military aircraft.
Chief Executive Officer Lawrence A. Bossidy said Allied also will cut capital expenditures by $225 million, sell eight non-strategic business units, consolidate its data processing, telecommunications and accounting functions, and restructure its manufacturing operations, primarily in the company's automotive business.
Bossidy said he also intends to ask the company's board to lower the regular quarterly dividend on the company's common stock from 45 cents per share to 25 cents.
These actions will result in a one-time pre-tax write-off against 1991 third quarter earnings of $880 million. The write-off is expected to result in a loss for the third quarter and the full year.
The program, to be implemented over the next 18 months, will achieve annual savings of about $350 million, with about two-thirds of the savings realized next year; a return to positive cash flow in 1992, and significant productivity gains, Bossidy said.
Allied-Signal is a $12 billion advanced technology company with businesses in aerospace, automotive products and engineered materials.