Electrolux cut 3,000 jobs and its CEO left — a decade of cost-cutting ran out of road

On 27 October 2023 Electrolux, the Swedish appliance maker, said it would cut about 3,000 positions and reorganize into three regional business areas and two global product lines, with fewer layers reporting to the chief executive. It booked a restructuring charge of SEK 2 to 2.5 billion in the fourth quarter of 2023 and raised its cost-savings target to SEK 10-11 billion for 2024, against 2022.

The reason was continued weak consumer demand and competitive pressure. Appliance makers had boomed during the pandemic, when people spent on their homes; as that demand normalized, Electrolux's volumes, particularly in North America, did not recover.

The cuts did not settle the question. On 25 April 2024 Electrolux announced that Jonas Samuelson, its chief executive since 2016, would leave on 1 January 2025, after about nine years. He was succeeded by Yannick Fierling, previously the head of Haier's European business.

Samuelson had spent much of his tenure cutting costs. But a cost program run after a cost program is a tell: the problem was not the cost base but demand that had not come back. The 3,000 jobs and the chief executive were both casualties of the same unresolved question.