Kohler Shuts US plant & Expands Mexican Plant
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Kohler Co. announced plans this week to shift production to factories in Reynosa Mexixo, bolstering unemployment in a maquiladora industry assailed by a global downturn in manufacturing.
On Monday, Kohler Co. said it will shutter a U.S. plant and fold production of stainless steel sinks into its Reynosa facility.
Kohler said the expansion of its factory in Reynosa will not create new jobs. The company will rehire workers that had been laid off. Kohler declined to say how many jobs have been cut this recession.
With the downturn in housing, demand for sinks manufactured at Kohler’s Searcy, Ark., facility had fallen and the company had to fuse production with the factory in Reynosa, Todd Weber, a vice president for the Kohler, Wis.-based manufacturer said.
“Both of our plants are underutilized,” he added. Kohler expects to close the Searcy facility by the end of the year.
Often, new employment in Reynosa comes at the cost of domestic manufacturing jobs. At the Searcy, Ark. plant, which famously weathered a strike that lasted from December 2006 to November 2007, the majority of Kohler’s 57 employees will lose their jobs the day before Thanksgiving.
Buck Layne, president of the Searcy Regional Chamber of Commerce, said that while the city was disappointed to lose the factory, the area has actually added jobs in recent months that could help mitigate the loss. The factory, which opened in 1966, once employed more than 400 people, Layne said.
The Reynosa plant, the other facility which manufactures sinks, opened in 2002 when the “housing market was thriving (and) demand for stainless steel sinks was equally robust,” the company said in a press release.
The recent economic revitalization in Searcy, a city with a population of about 20,000, has been led by natural gas companies, which have added about 2,000 jobs in the last 18 months, Layne said.
“It’s a global economy these days, but we need to make sure that we’re playing on an even field,” Layne said. “It’s just very discouraging to see jobs leaving the U.S.”
From the Monitor’s Sean Gaffney
