NOL to axe 1,000 jobs

Singapore - Singapore's Neptune Orient Lines will slash its workforce by some 1,000 people in order to stay afloat in a shipping industry that is expected to undergo a severe slump next year.

The company said most of the job cuts will be done in North America, and expects its Singapore office to lose some 50 employees. The bulk of staff reductions will be in non-customer-facing roles.

NOL also plans to relocate its Americas' regional headquarters from Oakland in California to a more cost effective location elsewhere in the US, to be announced next month.

The adjustments are expected to reduce the group's costs by about US$200 million in 2009, the company said in a statement.

NOL said market conditions have worsened considerably over the past month and it anticipates an even more challenging time going forward, describing the outlook for profitability in 2009 as grim.

"The negative conditions we are seeing in the marketplace are unprecedented in our industry's history," said NOL group president and CEO Ron Widdows. "This necessitates these very difficult decisions."

The group said it initiated capacity reductions to reduce vessel network and operating costs last month.

The adjustments are expected to cost the company approximately US$33 million in restructuring charges to impact fourth-quarter financial results.