Beach said Delphi hopes to achieve as many of the cuts as possible through attrition.

Delphi officials, who told workers of the job cuts at a meeting in Kokomo Monday, said the moves were needed to align the company's resources with a changing market.

'Consumer trends and market conditions have caused fundamental shifts in consumer preferences, impacting both the volume and mix of vehicles produced by our North American customers,' Jeff Owens, president of Delphi Electronics & Safety, said in a statement.

'Delphi E&S is reacting quickly to align its business with these rapidly changing conditions to assure Delphi's continued competitiveness.'

Record-high gas prices, weak consumer confidence and troubles in the lending industries have resulting in a dramatic decrease in U.S. vehicle demand, forcing automakers to scale back production and resulting in lower orders to companies such as Delphi.

In addition, the high gas prices have prompted a consumer shift in preferences away from gas-guzzling trucks and sport utility vehicles to more fuel-efficient cars, which use less electronic components, Beach said.

Delphi, the former parts-making unit of General Motors Corp., has been operating under Chapter 11 bankruptcy protection since October 2005.

And its fortunes remain significantly tied to those of GM. The Detroit-based automaker has promised nearly $1 billion in loans to help Delphi emerge from bankruptcy protection and it remains the company's largest customer.

Earlier this month, Delphi said its second-quarter loss narrowed on lower restructuring and other charges, but reported a 31 percent drop in sales that it partially blamed on lower production at GM.