WINSTON-SALEM -- Dell Inc. announced Wednesday it will close its computer manufacturing plant by the end of January, costing 905 workers their jobs and reigniting a debate about the value of economic incentives.
Dell's announcement comes four years to the month after Dell opened its plant with great fanfare in southeastern Winston-Salem. The desktop computer plant was supposed to spur spinoff development and help make the Triad a technology center.
When Dell picked North Carolina for its plant on Nov. 9, 2004, then-Gov. Mike Easley proclaimed "Dell's decision to locate in North Carolina means thousands of jobs are headed to the Piedmont Triad."
Instead, Dell said Wednesday that it will lay off about 600 workers next month and close the plant by the beginning of 2010. Workers losing jobs will receive severance packages and job placement help, the company said.
Dell received the largest incentives package in state history following a one-day special session of the N.C. General Assembly in November 2004.
Dell was pledged $281 million in state and local incentives to open the plant.
The company was supposed to invest $100 million, create 1,700 jobs by September 2010 and maintain those jobs for 10 more years to receive the full incentives. Dell said Wednesday it would comply with the terms of its incentive agreements with the state, Winston-Salem and Forsyth County.
From the outset, critics of the Dell incentives said the Texas-based computer conglomerate was promised too much too easily. In the fall of 2004, state legislators were told by Easley administration officials that they couldn't amend the Dell incentives legislation during the General Assembly special session.
Former state Supreme Court Justice Robert Orr, who challenged the incentives in court, said he regrets the loss of Dell jobs.
"The closing, however, provides a stark and painful example of the folly of the incentives game engaged in by our state and local governments. No matter how big the incentive package, operational decisions by businesses headquartered out-of-state will be driven by corporate financial considerations and not by any sense of loyalty to the community being left behind," said Orr, currently executive director of the N.C. Institute for Constitutional Law in Raleigh.
The plant closure is part of a plan to save $4 billion a year at Dell by 2011. Dell has plants in Austin, Texas, Miami, Nashville, Brazil, Ireland, Poland, China, Malaysia and India.
The Associated Press contributed to this report.
