Commercial Vehicle Group (CVG) says it is to consolidate its North American seat production into two facilities and cease seat production in its Piedmont, Alabama site.
The move – pending negotiations with the hourly employees’ union representative – will see the company continue to maintain a presence in Piedmont for its Aftermarket & Service distribution channel following the transfer of seat production.
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The Piedmont facility has historically manufactured commercial seats for the OEM and Aftermarket & Service markets.
Around one hundred sixty employees will be impacted by the restructuring, which is expected to be completed in the third quarter of 2016. Positions supporting the Aftermarket and Service sector distribution will remain in Piedmont.
“Restructuring changes and lay-offs are always difficult because of the impact on the community, our employees and their families,” said Global Truck & Bus Seats, SVP and managing director, Greg Boese.
“This plan is necessary however, to rationalise our manufacturing footprint capacity and reduce fixed costs to remain competitive as customer needs and marketplace trends shift.”
The company will be meeting with the UAW union representing hourly employees to negotiate its decision and to discuss transitional support, while salaried staff have also been informed.
The company plans to petition for assistance for affected employees under the Department of Labour Trade Adjustment Assistance Programme (TAA).
The company anticipates restructuring charges of approximately US$3m – US$4m and annual operating savings, once plans are fully implemented, represents a portion of the broader US$8m – US$12m restructuring guidance announced late last year.
“We value the contributions of our Piedmont employees, but intend to pursue this action to remain competitive in the marketplace,” added Boese.
“We look forward to remaining an active employer in the Piedmont community in support of our critical Aftermarket and Service distribution channel.
