Petrobras Said to Cut Parties, Chauffeurs to Save $12 Billion

  • Company looking to reach cost-cutting target by 2019
  • Will also cut outsourced staff, reduce management positions

Petroleo Brasileiro SA is doing away with chauffeured cars, overseas training programs, office parties and other perks as part of a plan to save $12 billion in corporate spending, people familiar with the measures said.

The chief executive officer and heads of divisions will be allowed to keep their cars with drivers, though, the people said, citing an Aug. 26 company memo and asking not to be named because the document isn’t public. The plan to reach the cost-cutting target by 2019 also includes dismissing outsourced staff and reducing management positions, the people said.

The company’s business plan foresees strategies to reduce costs and boost productivity, Rio de Janeiro-based Petrobras said in an e-mailed response to questions. Newspaper O Estado de S. Paulo reported the perk cuts earlier.

Mired in the biggest corruption scandal in Brazil’s history, the state-run producer is also grappling with an oil industry downturn, the biggest debt load of any crude producer and years of disappointing drilling results.

The company plans asset sales of $15.1 billion by 2016. Petrobras is also looking to progressively reduce its debt ratio through 2020.