Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from Mike Harrison, First Analysis.
Joe Scaminace
Hello, Mike.
Mike Harrison – First Analysis
Can you hear me?
Joe Scaminace
Yes.
Mike Harrison – First Analysis
Alright, great. Your plans to reduce costs, you mentioned salary freezes, looking at discretionary spending as well as headcount reduction. At this point, can you quantify the expected amount of annual savings from those actions?
Ken Haber
Yes. Those are totaling – our estimates are totaling about $23 million, $24 million.
Mike Harrison – First Analysis
And do you expect to be at that run rate during the first quarter or reach it maybe some time during the second quarter?
Ken Haber
It would be in the – more likely in the second half, starting in the second half of the year.
Mike Harrison – First Analysis
Okay. And then if end market weakness continues, are there more dramatic actions that you might be taking to reduce your manufacturing footprint or any idling of facilities that we might expect in the next several months?
Steve Dunmead
Mike, this is Steve Dunmead. Certainly, the differences in what we are looking at is all of the contingency plans that we have put together are on a business-by-business basis. And so certainly those are things that we are considering if the market either deteriorates further or the recovery does not begin to emerge. And so, yes, we have contingency plans in place that would look at a variety of cost reduction and cash preservation activities.
Mike Harrison – First Analysis
And, Steve, appreciate all the commentary on your expectations for the different markets. I was wondering if you could give maybe some more details on your expectations in the battery market as you look at hybrid vehicles, and I know you guys have done some work in the mix metal battery precursors, but maybe as you look out beyond 2009, do you continue to expect that to be a growth market?
Steve Dunmead
Absolutely, Mike. That is – we are certainly seeing some softness and some inventory reduction across the board in the battery sector. Truthfully, with the economy where it is and oil prices having come back down, there is a little pressure today on – and a little less activity on hybrid electric vehicles, but with what’s going on Washington I would expect to see that accelerated if we look forward. But certainly, we see no reason to go away from the kinds of cell unit volume growth that we had been seeing, historically, after this – the economy turns back around, which, as you know, has been in the 12% to 15% cell volume growth rate for at least the past five years.
- To read the full transcript on Seeking Alpha, click here »
