USA: GDX Automotive to close French plant
GenCorp Inc. has announced that the Board of Directors have approved a project to close Snappon SA, a company located in Chartres (France), one of three GDX Automotive manufacturing facilities located in France. The Chartres facility manufactures automotive sealing systems.
The closure project is due to declining sales volumes with French automobile manufacturers.
GDX Automotive will begin discussions with employee representatives in France and will develop employee transition programs for the approximately 260 employees that are expected to be affected by the plant closure. The contemplated closure of the Chartres facility is expected to be completed in the first half of 2004.
After offsets for U.S. tax benefits, the project is not expected to consume significant cash. The company expects that the costs of winding up the Chartres operations, completing employee transition programs and other closure costs, will result in a net charge to earnings in the second quarter of 2004 of approximately $10 to $15 million. During the fourth quarter of 2003, the company expects to record impairment charges and asset write-downs related to the project, which are expected to be substantially offset by the U.S. tax benefits.