Commercial Vehicle Group to Close Three Midwest Facilities
Cab-related products and systems supplier Commercial Vehicle Group Inc. announced that it would close three U.S. facilities in the Midwest beginning in the third quarter of the year in connection with a cost-reduction and restructuring plan it announced in 2015.
The affected facilities include plants located in Monona, Iowa, and Shadyside, Ohio, along with administrative offices in Wixom, Michigan, according to the company.
It said it will close its administrative office in Wixom when the lease expires in the third quarter of this year, as an outcome of its ongoing efforts to consolidate engineering services.
The company said the Monona facility manufactures wire harnesses and has about 146 employees and the work will be transferred to the its operations in Agua Prieta, Mexico.
A small group of administrative and sales professionals will remain in the Iowa market following the closure of the Monona facility, which is expected to be substantially completed by March 31, 2017, according to the company.
The Shadyside facility performs assembly and stamping activities and has about 172 employees and the activities there will be transferred to alternative facilities or sourced to local suppliers, CVG said.
The closure of the Shadyside facility is expected to be substantially completed by June 30, 2017, it said.
The company said it plans to petition for assistance for eligible employees under the Department of Labor Trade Adjustment Assistance Program.
“Decisions regarding facility closures are extremely difficult, but ultimately this restructuring plan reflects our ongoing efforts to align our manufacturing footprint with our customers and supply base in response to changing global macroeconomic conditions and the state of our end markets,” said Joseph Saoud, president of global construction, agriculture and military markets, said in a statement.
He added, “Our employees are important to us and we will provide support for impacted personnel, however we must strategically manage our overhead and competitive cost position in response to market conditions and customer expectations.”
“We understand the impact this decision will have on our employees and the communities of Monona and Shadyside where we have served as a long-time employer. Ultimately, we made the best decision we could to maximize our global capacity utilization in response to changing customer needs,” Dale McKillop, managing director of trim and structures, said in a statement,
"We will provide assistance to our employees, including severance benefits, and hope that many of them will consider opportunities with CVG in other markets," added McKillop.
The announcement follows one in May that reported pending negotiations with the hourly employees' union representative, to consolidate its North American seat production into two North American facilities and cease seat production in its Piedmont, Alabama facility.
In February, the company said it began construction of a new wire harness facility in Agua Prieta. "This facility will allow us to expand and enhance our capabilities for the construction, agriculture and specialty vehicle markets."
