US heavy-duty vehicle maker Oshkosh Corporation said Tuesday it would cut 900 jobs in its defense division this year mainly due to military spending cutbacks.
Oshkosh said in a statement it planned to cut about 700 hourly positions starting in mid-June and to eliminate 200 salaried jobs through July.
The layoffs will reduce the workforce in the defense division to approximately 2,800 employees.
"Oshkosh expects domestic military vehicle production volumes to decline significantly as the year progresses," predicting output to drop by 30 percent in the coming months, said the company, based in Oshkosh, Wisconsin.
It blamed "the reduction in US defense budgets and a return to peacetime spending levels as the US winds down war activities."
Facing a swollen budget deficit, the government is sharply reducing spending under the so-called "sequester" program of automatic cuts that took effect on March 1.