PPG Industries, a Pittsburgh-based manufacturer known for its paints and coatings, is undergoing significant restructuring to optimize operations. As part of these efforts, the company plans to lay off nearly 2,000 workers. The decision is part of a broader strategy to reduce costs and align its business focus following recent divestitures, specifically targeting improvements in their European and other global operations. These changes are not expected to affect the company’s ongoing investments or growth initiatives.
Earlier information related to PPG’s business strategies indicated similar trends in reducing operational costs and streamlining its workforce. The company’s continuous adaptation to changing market demands has necessitated periodic layoffs and divestitures. Over the years, PPG has consistently sought to balance its workforce and operational costs in alignment with its broader business goals, which are focused on increasing competitiveness and maintaining financial health.
What led to the layoffs?
The layoffs, affecting approximately 1,800 positions mainly in the U.S. and Europe, are part of PPG’s comprehensive cost reduction program. This program includes not just workforce reductions but also facility closures, especially in Europe and other select global markets. These initiatives aim to decrease structural and corporate costs, ensuring the company’s long-term stability and efficiency.
How will the divestitures impact PPG?
PPG’s decision to sell its architectural coatings business in the U.S. and Canada to American Industrial Partners for $550 million is a pivotal move. This division generated $2 billion in net sales in 2023. The transaction is expected to finalize by late 2024 or early 2025, offering PPG an opportunity to concentrate more on its core activities and future growth prospects.
PPG’s CEO, Tim Knavish, highlighted the necessity of these actions, noting their importance in adjusting the company’s fixed cost structure after divesting from the silicas products and architectural coatings businesses.
“While these decisions are difficult, they are necessary to adjust our fixed cost base and to right-size our company,”
said Knavish, emphasizing the strategic imperative of these adjustments.
Despite the workforce reductions and business sales, PPG reassures that its commitment to organic growth and ongoing investments remains unchanged. The focus will now be on maintaining a leaner operation while exploring new opportunities to strengthen its market position.
The decision to sell parts of its business, including brands such as Glidden, Olympic, Manor Hall, and Liquid Nails, reflects PPG’s ongoing evaluation of its business portfolio. By reallocating resources and refining its business structure, PPG aims to bolster its competitive edge globally. Understanding these dynamics is crucial for stakeholders, as the company navigates the complexities of the global market while striving to retain its leadership in the paint and coatings industry.
