Tenneco plans to close its emission control plant in Vittaryd, Sweden in response to weak market conditions throughout Europe which have negatively impacted the company’s aftermarket emissions control sales.
“We sincerely regret the impact this action will have on our employees at Vittaryd,” said COO Hari Nai. “However, declining market conditions require that we consolidate our aftermarket emission control capacity in Europe which will better align our production with the market and help strengthen our long-term competitiveness.”
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Tenneco expects to complete the closure in the third quarter of 2013. The company employs about 113 hourly and nine salaried workers at the plant.
The company expects a smooth transition of production to other emission control operations in Laval, France; Edenkoben, Germany; Valencia, Spain and Rybnik, Poland, beginning later this year.
The plant closure is subject to consultation with employee works councils. Tenneco expects to take restructuring and related charges in the range of US$10m to $14m over the next four quarters. These charges include non-cash asset impairments, the cost of relocating tooling, equipment and production to other facilities, severance and retention payments to employees, and other costs related to the closure. The company expects to record non-cash charges of $4m in the third quarter of 2012 with the remainder of the charges expected to be recorded over the next three quarters. Tenneco anticipates annual savings of $4m beginning in late 2013 once the plant is shut.
