In an indication that the USA continues to remain in the grip of recession, home appliance maker Whirlpool Corp said on Friday that it will close one of its major factories in Evansville, Indiana. The move will lead to job-cuts of around 1,100 in 2010, the company admitted.
Refrigerator and freezer production at the factory will move to one of its facilities in Mexico. The company has yet to decide on the fate of a product-development centre in Evansville with 300 employees, as well as where it will relocate production of ice makers.
Whirlpool relies heavily on sales to new home buyers as well as the replacement market in North America, but the housing market remains stagnant amid high foreclosure rates and sluggish building activity.
Late last year, Whrlpool had announced that it would cut some 5,000 jobs through 2009 in response to falling demand, which is roughly 7 per cent of its work force. Whirlpool's shipments are expected to be down 10-12 per cent this year.
"This was a difficult but necessary decision. To reduce excess capacity and improve costs, the decision was made to consolidate production within our existing North American manufacturing facilities," Whirlpool's North American manufacturing operations vice president Al Holaday said.
The move would allow the company to streamline its operations, improve capacity utilisation, reduce product overlap between plants and meet future production requirements, Holaday added.