Thread Number: 78302  /  Tag: Modern Automatic Washers
Electrolux Closing Memphis Plant Due To Tariffs
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Post# 1023272   2/1/2019 at 08:50 (1,991 days old) by Tomturbomatic (Beltsville, MD)        

New York (CNN Business)Swedish appliance maker Electrolux says it will close a manufacturing plant in Memphis, as the household appliance business contends with higher steel prices and Sears' bankruptcy.

The Memphis factory, which builds Frigidaire and Electrolux ovens and employs about 530 people, will shut down by 2020, according to Electrolux.

The company said the closure is part of a $110.5 million plan to streamline manufacturing that includes shuttering a second plant in Santiago, Chile and upgrading a facility in Springfield, Tennessee.

Electrolux, which owns Frigidaire, said in a press release that it is rethinking its strategy "in light of changing market dynamics, increased raw material costs and current trade policy."

President Donald Trump implemented steep tariffs on most steel and aluminum imports last year. Trump said the move was meant to boost domestic production of the materials, but trade groups warned that it would lead to soaring costs for goods that are made with steel and aluminum.

Electrolux spokesperson Eloise Hale declined to detail how the the company has been impacted by raw material price increases and US trade policy, but she said steel is a "key material" for the company.

American-made appliances have also struggled because of competition from cheaper products imported from abroad, Parks Associates analyst Brad Russell said.

The appliance market is also hurting from the shutdown of many Sears locations as the company navigates bankruptcy. Sears for decades served as a go-to shopping destination for ovens, washing machines and other large appliances.

Sears filed for bankruptcy last year. At the time, Frigidaire was listed as one of its largest creditors: Sears owed the brand $18.6 million, according to court filings. Hale declined to provide additional comment.

Alan Shaw, the North American head of major appliances at Electrolux (ELUXF), said in a statement that the company is "committed to investing in U.S. manufacturing and launching new Frigidaire kitchen products."

That includes a plan to invest $250 million in an expansion of a 45-year-old plant in Springfield, Tennessee, about four hours northeast of Memphis.

But the expansion will not necessarily mean new jobs.

"The investment will go toward modernizing the plant with automation and expanding production," Hale said. "This is not about job growth."

Electrolux, which acquired American brand Frigidaire in 1986, is a massive appliance producer with 56,000 employees and factories all over the globe, according to its latest annual report.

The company's US portfolio includes plants in South Carolina, North Carolina and Minnesota where the firm produces freezers, refrigerators and dishwashers.


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Post# 1023286 , Reply# 1   2/1/2019 at 10:43 (1,991 days old) by vacerator (Macomb, Michigan)        
That plant isn't

even very old, is it? Or, it was expanded and remodeled within the past 5 years.
Wow, just wow!

Post# 1023291 , Reply# 2   2/1/2019 at 11:32 (1,991 days old) by robbinsandmyers (Conn)        
What I dont understand is.....

robbinsandmyers's profile picture
With all the scrap metal yards in this country that cold supply mmetal to the industry as low cost because China is more than loaded with scrap metal to the point they pay nothing for it now and have been getting it from other countries cheaper than here. So the tariffs shouldnt matter if we dont have to import metal in the first place. Unless its because they outsource the vast number of components in China then only assemble here????

Post# 1023293 , Reply# 3   2/1/2019 at 12:01 (1,991 days old) by henene4 (Heidenheim a.d. Brenz (Germany))        

Refining scrap metal is a lot of complicated(ish) work.

Materials and resources needed to do that are expensive in the US.
In China they are not.

Really, you can't compare labor costs from China to any Western country.
We're talking a factor of 5-10.

That is just. Not viable. Plus the US does not have the infrastructure to suddenly become self sufficient.
Not even close.

Post# 1023400 , Reply# 4   2/2/2019 at 13:19 (1,990 days old) by Pierreandreply4 (St-Bruno de montarville (province of quebec) canada)        
i think its the same plant that move from l'assomption

pierreandreply4's profile picture
I think its the same plant they where located in l'assomption province of wubec to move to Tennessee here the article link

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