General Cable Corp. announced today that it is closing its Taunton, MA manufacturing facility.
The 131,000-square-foot facility employs 77 associates, produces bare copper strand and PVC jacketing compounds and supplies them to other General Cable manufacturing facilities to produce a variety of wire and cable products, primarily in the company's Industrial & Specialty segment. The company will incur a charge in the fourth quarter of 2003 related to the closure of the plant and estimates the amount of the charge to be approximately $7.0 million, of which about $4.0 million will be cash costs.
The company also announced it has initiated feasibility studies at its South Hadley, MA and Marion, IN manufacturing facilities. The studies will consider whether the company should continue operations at these locations or whether the product lines should be moved to other company facilities or, with regard to the South Hadley facility, outsourced to a wire conductor fabricator. The company plans to announce the results of its studies either later this quarter or early next year and would take additional charges over the period the operations are wound down should it decide to rationalize these two industrial cable facilities. The estimated cost to rationalize these facilities could approximate $20 million, with cash costs about one-third of this amount.
"The unprecedented decline in North American industrial activity over the last several years has resulted in a significant reduction in the production loads in our industrial cable plants. This decline in production volume has had a negative impact on the Taunton plant's competitive cost position and has necessitated this action," says Gregory Kenny, president and chief executive officer of General Cable. "The Taunton plant closure will reduce our overall fixed costs as we outsource the products the plant makes at a lower cost than we can manufacture them ourselves."
"The decision to close the facility was based strictly on economies of scale and our need to be the low-cost producer in a highly competitive industrial cable market," adds Kenny. "Our associates in Taunton have worked hard to improve manufacturing efficiencies and reduce costs over the past several years and I would like to thank them for their efforts and dedication to General Cable during these difficult times."
General Cable, based in Highland Heights, KY, manufactures copper, aluminum and optical fiber wire and cable products for the energy, industrial, specialty and communications markets. For more information visit www.GeneralCable.com.
