In this week's issue:
- DHL cutting 9,500 U.S. jobs.
- Motor home, RV dales running out of gas.
- Fidelity Investments layoffs not 'mutually' exclusive.
- Plus, a whole new round of major U.S. corporation closures and layoffs were announced in: Alabama, Connecticut, Florida, Georgia, Indiana, New Jersey, Ohio, Pennsylvania, Utah and Virginia.
DHL Cutting 9,500 U.S. Jobs
DHL, an international logistics and express service provider, is repositioning of its loss-making U.S. Express business.
Going forward, DHL's U.S. Express business will focus entirely on its international offering and will discontinue domestic-only air and ground products on Jan. 30, 2009.
As a result of the strategic shift, DHL Express will close all of its U.S. ground hubs, reduce the number of stations from 412 to 103 and cut nearly 9,500 employees.
"This is the right move for our U.S. Express operations given the current economic climate and for the long run. When we looked for efficiencies in the U.S. Express market, we decided to focus on what we do best as a company, and that's international shipping," said John Mullen, Global CEO of DHL Express.
DHL will retain 3,000 to 4,000 U.S.-based employees who are tailored to the needs of DHL's international express customers.
These measures will allow DHL Express' U.S. business to reduce its operating costs from the current $5.4 billion to less than $1 billion, a reduction of more than 80%.
Motor Home, RV Sales Running Out of Gas
Last summer, it was the $4/gallon of gas taking a toll on the sale of motor homes and recreational vehicles. However, now that gas prices have retreated to the low $2/gallon, the industry continues to see deteriorating conditions.
"As difficult as conditions have been all fiscal year, the company's fourth quarter [ended Sept. 30] was even more challenging," said Bob Olson, Winnebago Industries' chairman, CEO and president. "While fuel prices stabilized somewhat during the quarter, the U.S. economy continued to falter, with the availability of credit and rising interest rates becoming major concerns for both our retail customers and our dealers. As reflected by the motor home industry's reports in both wholesale deliveries and retail sales, conditions have continued to deteriorate throughout the year. Wholesale shipments of motor homes as reported by the Recreation Vehicle Industry Association are down 39% calendar year to date through August and deteriorated significantly in our fiscal fourth quarter; with industry shipments down 54% in June, 56% in July and 65% in August."
"Likewise, Statistical Surveys Inc., the retail reporting service for the RV industry, has reported Class A, B and C motor home retail sales for the industry down 37% calendar year to date through August and over 50% in our fiscal fourth quarter," Olson said. "As a result of these market conditions, our dealer partners are continuing to focus on lowering their inventory levels. Winnebago Industries' dealer inventory decreased nearly 700 units in the fourth quarter, or approximately 16%. In many cases, our dealers are choosing not to reorder inventory as it is retailed, which has also had a negative impact on the sales order backlog.
"Due to the decline in motor home market conditions, we have continued to reduce our head count through attrition and workforce reductions in order to more closely match production to the current demand," Olson said. "During the fourth quarter ended August 30, 2008, Winnebago Industries reduced its workforce company-wide by approximately 600 full-time hourly and salaried employees which included the closure of CCMF and reductions that occurred in the rest of the company."
Since Oct. 1, Winnebago has reduced its head count by an additional 300 employees and currently has approximately 1,930 employees, a 42% decrease since August of last year. Among the cuts was the closing of its Charles City, IA, manufacturing facility at 2100 W. Corporate Drive, which primarily manufactured Class C products. That action affected 190 workers.
In addition to workforce reductions, Winnebago is continuing to look at various other cost savings initiatives.
"Unfortunately, there is little good to report on at the top sales line of the RV Group," Mike Terlep, president of the RV Group for Coachmen Industries, Inc. told investors in its third quarter conference call. "In the third quarter, Industry motorized shipments were down 65% and towables were down 40%."
"The financial markets, specifically credit, consumer confidence, the deterioration of personal wealth through the stock market, and the loss of equity in home values continue to challenge the industry … to put it mildly," Terlep said. "Until the financial markets stabilize and consumer confidence has a pulse again, we anticipate continued challenges throughout the Industry. But I believe that we need to remind ourselves. . .this, too, will pass. . .albeit like a slow moving storm, but it will pass and the RV market will return."
Coachmen has been reducing inventories and overhead. It has consolidated production facilities, reduced its people count by approximately 40% and redeployed assets.
Layoffs Not 'Mutually' Exclusive
Global economic conditions and the unsettled nature of the world's stock markets all year long have required businesses around the globe and across all industries to examine their operations and make adjustments, including now mutual fund giant Fidelity Investments in Boston
Fidelity will commence a layoff this month of about 1,275 employees or about 2.9% of its 44,400-employee workforce. In addition, Fidelity also will undertake a second round of layoffs in the first quarter of next year, the details of which will be finalized in the coming weeks.
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Closures & Layoffs
The following future closings and permanent mass layoffs were reported in Alabama
- Cerro Wire & Cable Co. has started laying off 40 employees at 1099 Thompson Road SE Hartselle.
- FPMI Solutions Inc. is closing down and laying off 89 employees in Arab on Dec. 29.
The following future closings and permanent mass layoffs were reported in Connecticut
- Greenwood Publishing Group Inc. is closing down and laying off 150 workers at 88 Post Road West in Westport on Dec. 6.
- Staff Management is laying off 350 workers in Stamford starting Jan. 1 and concluding by April 2010.
The following future closings and permanent mass layoffs were reported in Florida
- Auto Trader.com Inc. is laying off 69 workers at 3451 Technological Ave. in Orlando by Feb. 23, 2009.
- Coca-Cola Enterprises Inc. is laying off 33 workers at 521 Lake Kathy Drive in Brandon on Dec. 31.
- Continental American Corp. is laying off 45 workers at 4600 SW 34th St. in Orlando on Dec. 31.
- Florida Made Door Co. is laying off 80 workers at 13700 Virginia Ave. in Astatula by Jan. 1, 2009.
- JPMorgan Chase is laying off 93 workers at 4919 Memorial Highway, 1st floor, in Tampa by Dec. 20.
- Kmart Corp. is laying off 50 workers at 8191 S. Tamiami Trail in Sarasota by Jan. 18, 2009
- Luhrs Corp. is laying off 169 workers at 255 Diesel Road in St. Augustine on Jan. 1, 2009.
- NuAir Manufacturing is laying off 126 workers at 8105 Anderson Road in Tampa by Dec. 18.
- Publishers Circulation Fulfillment Inc. is laying off 105 workers at 3351-B McLemore Drive in Pensacola on Dec. 19.
- Raymond Building Supply is laying off 62 workers at 4000 N.W. 119th Drive in Jasper on Dec. 1.
- Sears Holdings Corp. is laying off 89 workers at 9500 9th St. North in St. Petersburg on Jan. 11, 2009.
The following future closings and permanent mass layoffs were reported in Georgia
- Aramark Facility Services is laying off 113 employees at In Atlanta.
Atlanta Journal Constitution is laying off 117 employees at In Atlanta.
- Automobile Protection Corp. is laying off 35 employees at 6010 Atlantic Blvd. in Norcross.
- Hagemeyer North America is laying off 100 employees at 1275 Barrow Industrial Pkwy. in Auburn.
- International Paper Co. is laying off 82 employees at 472 Eagles Landing Pkwy. in Stockbridge.
- Lanier Clothing is laying off 26 employees at 736 Woodbury Road in Greenville.
- Shaw Industries is laying off 444 employees at In TRENTON.
- Warranty Corp of America is laying off 225 employees at 3110-20 Crossing Park in Norcross.
- Wayne Farms LLC is laying off 597 employees at 5550 Mallory Road in College Park.
The following future closings and permanent mass layoffs were reported in Indiana
- Archer Land Title Inc. with two locations in Indianapolis is laying off 48 employees by Dec. 1.
- Kmart Corp. is closing down and laying off 53 employees in Clarksville by Dec. 18.
- Salga Inc. is closing down and laying off 83 employees at 601 W. Water St. in Fremont by Dec. 20.
- Sears Holdings Corp. is closing down and laying off 110 employees at two locations in Indianapolis by Jan. 11, 2009..
- Taylor University is closing down and laying off 93 employees at is branch campus in Fort Wayne by May 31, 2009. Taylor University's main campus in Upland is not affected.
The following future closings and permanent mass layoffs were reported in New Jersey
- American Fuji Seal with three locations in Fairfield is laying off 68 workers Nov. 21.
- Burlington Resins is laying off 122 workers at its Colorite Specialty Resins at 1800 Beverly Road in Burlington this month.
- EBI Holdings is laying off 111 workers at 100 Interpace Parkway in Parsippany this month.
- Equity One is laying off 147 workers at 301 Lippincott Drive, Suite 100, in Marlton this month.
- GMAC Mortgage is laying off 32 workers at 7 Carnegie Plaza in Cherry Hill on Nov. 26.
- Newark Morning Ledger is laying off 1,657 workers in Newark and the Times of Trenton is laying off 151 workers in Trenton on Jan. 5, 2009.
- Popular Mortgage is laying off 167 workers at 121 Woodcrest Road in Cherry Hill this month.
- SWS Warehousing is laying off 32 workers at 26 Engelhard Drive in Monroe this month.
- VWR International is laying off 76 workers at 405 Heron Drive in Bridgeport on Feb. 28, 2009.
The following future closings and permanent mass layoffs were reported in Ohio
- 3M Precision Optics is closing down at 3997 McCann Road in Cincinnati and has begun laying off 106 workers.
- CEVA Logistics U.S. Inc. is closing down warehouse operations at 739 Moore Road in Avon Lake and 745 Leo Bullocks Parkway in Elyria. Both warehouses service Ford Motor Co.'s plant in Avon Lake. The closures will affect 130 workers by yearend. Sypris Technologies is closing its facility at 13627 State Route 68 South in Kenton laying off 232 workers Feb. 1, 2009.
- Holophane (aka Acuity Brands Lighting) is giving serious consideration to closing down its Newark facility at 214 Oakwood Ave. The closure would affect 106 workers. The decision is expected to come by mid December and layoffs would begin immediately.
- International Converter LLC is closing down at 721 Farson Ave. in Belpre and laying off 57 workers Dec. 24.
- Kmart Corp. is closing its store at 12171 Parkfield Drive in Forest Park laying off 64 workers by Jan. 4.
- Lane Hotels Inc. is shutting down the Toledo Crowne Plaza Hotel at 444 N. Summit St. in Toledo and laying off 145 workers this week. The hotel is owned by Paradise Hospitality Inc., which has not revealed its plans for the property.
- Logistics Services Inc. is laying off 50 workers at 2815 S. Gettysburg in Dayton on Dec. 23.
- Ohio Bell Telephone Co. is closing the AT&T Customer Call Center at 401 Cleveland Ave. NW in Canton and laying off 58 workers Dec. 22.
The following future closings and permanent mass layoffs were reported in Pennsylvania
- Bank of America is laying off 109 employees at 340 S. Warminster Road in Hatboro.
- Crest Homes is closing down and started laying off 146 employees at 201 North Industrial Park Road in Milton.
- Eighty Four Mining Co. is closing down and laying off 75 workers at Mine 84 at 200 Hallam Road in Washington on Dec. 18.
- International Automotive Components is closing down and laying off 90 workers at 50 Spring Road in Carlisle on Dec. 22.
- The Commodore Corp. is closing down and started laying off 107 workers at 22793 Route 66 North in Shippenville.
- The Hershey Co. is closing down and laying off 252 workers at 200 N. 8th St. in Reading on Dec. 19.
The following future closings and permanent mass layoffs were reported in Utah
; no dates were identified.
- IAP World Services is losing its contract with the IRS and laying off 376 workers in Clearfield.
- Kmart is closing its store at 2705 Parleys Way in Salt Lake City and laying off 46 workers.
- Luxottica is closing down at 1887 S 3230 W in Salt Lake City and laying off 103 workers.
- Otto & Sons is laying off 96 workers at 4980 W 9470 S in West Jordan.
- Rayloc, a division of Genuine Parts Co. is laying off 46 workers at 700 N. 500 E in Payson.
The following future closings and permanent mass layoffs were reported in Virginia
- Graphic Packaging International is closing down and started laying off 150 workers at 4500 Sarellen Road in Richmond.
HP Hood LLC is laying off 75 workers at 2537 Catherine St. in Bristol on Jan. 1, 2009.
- Pitney Bowes Management Services Inc. is laying off 172 workers in Lynchburg on Dec. 31.
- Qimonda is laying off 1,200 workers at 6000 Technology Blvd. in Sandston on Dec. 14.
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