Chevron to Cut 15%-20% of Workforce
Chevron Corporation is set to reduce its workforce by 15%-20% as part of a restructuring effort. The energy giant aims to streamline its operations, boost efficiency, and stay competitive in the long run. The company announced the layoffs in a statement from Vice Chair Mark Nelson on Wednesday.
Chevron’s global workforce consisted of over 40,200 non-service station employees and nearly 5,400 service station workers by the end of 2023. The upcoming job cuts will impact a significant portion of these employees.
Layoffs to be Completed Before 2026
Nelson confirmed that most of the layoffs will take place this year and wrap up before the end of 2026. He emphasized that the decision was not made lightly and that Chevron will provide support to affected employees. The move is part of a broader strategy to strengthen the company’s financial position and enhance operational efficiency.
“Responsible leadership requires taking these steps to improve long-term competitiveness for our people, shareholders, and communities,” Nelson said in the statement.
Cost-Cutting and Strategic Goals
Chevron is targeting $2-$3 billion in structural cost reductions before 2027. The company plans to achieve this through layoffs and other efficiency measures. CFO Eimear Bonner first outlined this goal in November during the third-quarter earnings report. She assured investors that updates on cost-saving efforts will continue through 2025.
Nelson noted that Chevron is optimizing its portfolio, using technology to boost productivity, and expanding global operations. He said the company’s structural changes will improve efficiency and unlock new growth potential.
Financial Performance and Future Outlook
The layoffs come shortly after Chevron released its fourth-quarter earnings report. The company generated $52.2 billion in total revenue and posted a net income of nearly $3.24 billion for the quarter.
For the full year of 2024, Chevron reported revenues of $202.79 billion and a net income of $17.66 billion. This marks a 17.35% drop in net income compared to the previous year. However, Chevron’s global net oil-equivalent production increased by 7% year over year.
Despite the layoffs, CEO Mike Wirth remains optimistic about Chevron’s future. He stated last month that the company is “in a strong position today” and expects even better performance in 2025 and 2026.
Chevron’s Shift in Strategy
Chevron’s workforce reduction aligns with its broader efforts to adapt to industry changes. The company has been optimizing its operations, centralizing functions, and leveraging technology to remain competitive.
Additionally, Chevron has been expanding its presence outside of California. The company previously announced the relocation of its headquarters to Texas, citing regulatory challenges in California.
Impact on Employees and Industry
Chevron has not disclosed specific details about which departments or regions will see the most job cuts. However, given the scale of the layoffs, thousands of employees worldwide will be affected. The energy sector has seen similar job cuts in recent years as companies adjust to market conditions and seek efficiency gains.
As Chevron moves forward with its restructuring, employees, investors, and industry analysts will closely watch how these changes impact the company’s performance and market position.
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