Flextronics Americas to close Creedmoor plant
Flextronics Americas is permanently closing a plant in Creedmoor that produced Redbox DVD rental kiosks, affecting 157 employees.
A Worker Adjustment and Retraining Notification Act notice sent to the N.C. Department of Commerce’s Division of Workforce Solutions said the closing will occur in phases. All layoffs are expected to be complete by the end of March.
Affected employees will be eligible for a separation payment, the notice states.
“We regret the need to take this action, which is the result of ongoing integration activities and the strategic realignment of capabilities to meet current business requirements,” the notice also states.
Singapore-headquartered Flextronics is an electronics manufacturing services provider that helps customers build, ship and service electronics.
In May of 2010, Redbox and Flextronics held a ceremony at the Creedmoor facility to announce that they reached production of 25,000 Redbox DVD rental kiosks, according to a news release about the event.
Renee Brotherton, vice president for corporate communications, said in an email that the decision to close the facility in Creedmoor is a “direct result” of a plan to optimize and streamline the company’s footprint in this region.
“We will transfer the work at this site to existing operations in the USA; we expect the process to conclude by the end of March of this year,” she said. “We are making every effort to help our employees through this difficult time and are providing severance packages in accordance with company customs.”
Flextronics reported for the third quarter that ended Dec. 31 that its net income was down 75 percent to $25 million. Its net sales were down 18 percent to $6.12 billion.
The company said it had $103 million in pre-tax restructuring charges in the quarter that included charges related to employee severance and benefits.
In the fourth quarter, the company expects an additional $100 million to $125 million in pre-tax restructuring charges comprised primarily of employee severance and benefit costs.
“It is clear that the macroeconomic environment is challenging with limited visibility and many economic risks remain,” said Mike McNamara, CEO of Flextronics, in a statement in a news release. “We are aggressively optimizing our operating footprint and improving our cost structure to better position us for our multi-billion dollar pipeline of recent bookings, and the eventual improvement in the business environment.”