Decatur tool plant set to close
Posted on Saturday, April 26, 2008
Black & Decker Corp. is closing its Decatur plant and laying off all 82 employees as part of a companywide cutback that will eliminate 3 percent of its work force.
The Towson, Md.-based toolmaker made the announcement Thursday after reporting firstquarter earnings were down 37. 6 percent from a year earlier, citing the slumping housing market and the subprime mortgage crisis.
A plant official confirmed Friday that the power washer manufacturing facility will be shuttered by the end of the summer.
Chuck Chism, director of operations, said layoffs will be done in three rounds, with the first round to affect about 40 employees at the end of June.
A second round is tentatively scheduled for the end of July. The facility will be completely closed by the end of August, Chism said.
Employees will receive severance pay in addition to other support.
“This plant a few years ago made about 7, 000 machines a year, ’’ Chism said. “ Our current business is considerably less than that.”
The plant makes gasolinepowered pressure washers that sell for between $ 200 and $ 1, 000. The portable units clean surfaces using a forceful current of water.
Work performed in Decatur will be relocated to Jackson, Tenn., since that facility has available manufacturing capacity, he said.
Decatur is expected to feel the effects of layoff.
The mayor of the Benton County town of about 1, 500 people said in previous stories that the community benefited from having the plant that originally operated as Excell Manufacturing and made hoist assemblies for Wal-Mart Stores Inc.
Phone messages to Mayor Bill Montgomery asking for comment were not returned Friday afternoon.
Black & Decker bought the Decatur facility in 2004 from Pentair, a Minnesota-based tool manufacturer.
In 1999, Pentair bought the business from DeVilbiss Air-Power Co., of Jackson, Tenn., which ran the pressure-washer business for three years. DeVilbiss bought the business from Excell Manufacturing.
Black & Decker has begun sending notices to the 700 people across the country who’ll lose their jobs. Of those workers, 250 are in administrative positions and 450 are plant employees, but the company hasn’t yet specified publicly where all of them work.
An office in Florida that the company acquired in 2006 when it purchased Vector Products also will be closed.
Black & Decker employs about 25, 000 people worldwide.
Analysts said the company likely had little choice but to make cuts.
“Their costs continue to go up and they haven’t really been able to pass that on,” said John Kearney, a Chicago-based equity analyst with Morningstar Inc.
Shares of Black & Decker closed at $ 67. 58, down 31 cents or 0. 46 percent Friday on the New York Stock Exchange. Shares have traded as high as $ 97. 01 and as low as $ 61. 71 over the past year. Information for this article was contributed by The Associated Press.
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