This is necessary to strengthen Delphi both in the uncertain near-term and to compete in the long-term

J.T.Battenberg Delphi Chairman

This amounts to 5% of the workforce of the world's biggest car parts supplier.

Two thirds of the job losses will be within the US.

Nine plants will be sold, closed or consolidated in France, Brazil, Germany, Italy, UK and the US.

The cutbacks come in the face of a slowing US economy and continued uncertainty in the global car manufacturing industry, suffering from oversupply.

Quick response to industry change

The firm hopes that the restructuring will generate about $900m in annual savings.

Factory closures/sales

3 in US 2 in Brazil 1 in France 1 in Germany 1 in Italy 1 in Southampton, UK

Costs from the restructuring in the first quarter are estimated at $400m.

As well as the nine plant closures, jobs will be shed at 40 other bases.

"These actions are consistent with Delphi's long-term plan and our track record of responding quickly to industry changes to ensure that the company has a healthy, growing and secure future," said the company's chairman.

Profits warning

Delphi also revised its first quarter revenue expectations down to $6.4-6.5bn, $100-$150m below the levels forecast in January.

But the firm said it was confident of renewed sales growth in the second half of 2001.

Delphi has about 211,000 employees in 42 countries, with regional headquarters in Paris, Tokyo and Sao Paulo.

Further job cuts could be on the cards later this year, with other parts of Delphi's portfolio still under review.