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Thursday, December 04, 2008

Hundreds of layoffs on horizon

Western Virginia companies cutting jobs in early '09

Intermet makes cast-metal auto parts at its foundry in Radford.

The Roanoke Times | File August

Intermet makes cast-metal auto parts at its foundry in Radford.

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Previous coverage

Local layoffs

Four companies stretching from Bedford to Wytheville are looking at layoffs involving more than 400 workers starting early next year, with as many as 300 of those jobs imperiled by the drastic drop in U.S. auto sales.

The companies are all in the manufacturing sector, including auto parts, furniture and packaging. They come in the wake of an additional 220 recession-related layoffs across the region in November.

Acument Global Technologies announced Wednesday it will close its Wytheville factory by the end of next year, eliminating 162 jobs.

The company said it is working with government, private and education agencies to line up job retraining and search assistance for workers by January. The layoffs are scheduled to begin during the first quarter.

"These difficult automotive industry conditions have caused sales erosion, a steady decline in employment levels, and very low capacity utilization at the Wytheville Operations fastener manufacturing plant," spokesman Timothy Weir said.

Meantime, Intermet Corp., a maker of cast-metal auto parts, told the state Nov. 21 its unionized New River Foundry in Radford will possibly lay off 140 people on or before Jan. 20.

The filing does not require a company to act, only to notify employees of a possible layoff or closure.

The Acument and Intermet news comes as domestic vehicle production and sales have declined nationally and automakers are seeking assistance from Congress. It also underscores an economic vulnerability for Southwest Virginia: Most of the state's automotive manufacturing industry, which employs 10,000 to 11,000 people statewide, is based in the region.

Eddie Lowery, subdistrict director for the United Steelworkers, which has a local collective bargaining unit at the Intermet factory, is distressed by what he sees.

"Hopefully, the government can see fit to provide relief as they've done for other industries," he said. "Without that, we're dead in the water until something happens for the economy."

As recently as March, the state counted between 250 and 500 employees at Intermet in Radford, which has produced such items as rear axle and differential carriers, steering knuckles and brake calipers.

In August, the company based in Fort Worth, Texas, said it had trimmed the work force from 216 to 160 and entered bankruptcy proceedings for the second time.

Lowery said the company recalled most of those laid off in August. But now, he expects Intermet will lay off 140 people as its notice said. He said the factory's human resources director, Doug Howell, told him that the plant will then halt production and stand idle with 58 people kept on for maintenance.

Intermet spokesmen Gordon Cole and Craig Miner had no comment on Lowery's statement or the layoff notice.

Frank Chervan Inc.

In early February, Roanoke-based furniture frame and seating manufacturer Frank Chervan Inc. will close all Bedford operations except for its rough lumber mill, a move that will affect about 90 of its 210 employees companywide. It will consolidate operations at its Roanoke factory.

Some of the Bedford employees could be offered jobs at Chervan's Roanoke factory.

The 80-year-old, privately owned company, which established a plant in Bedford nearly 60 years ago, attributed the Bedford closing to "rapidly rising health care costs and turmoil in financial markets."

In Bedford, Chervan has manufactured hardwood furniture frames for wood and upholstered seating. The upholstering and other work has been completed in Roanoke.

During February and March, Chervan will transfer the furniture frame equipment and operations to its Roanoke plant, located in the former Hooker Furniture Co. factory in Southeast Roanoke.

Chervan is a supplier, as a contract manufacturer, to health care, office, hospitality and residential furniture industries. Its products are sold under other brand names.

Greg Terrill, Chervan's president, reported that banks and other financial institutions have been one of the company's largest markets, and he said that the sector's struggles suggest Chervan must prepare to weather significantly reduced demand in 2009.

Among other customers, the company is a supplier for Sam Moore, the Bedford chair manufacturer acquired by Hooker Furniture Corp. in April 2007.

Larry Ryder, Hooker Furniture's executive vice president for finance and administration, said Wednesday that Sam Moore employs about 270 people in Bedford and is currently working a four-day work week there.

"We're all in the same boat in the furniture industry right now," Ryder said. "And it's a rocky boat. Consumers just aren't opening up their pocketbooks."

Shorewood Packaging

Shorewood Packaging, an International Paper subsidiary headquartered in New York, notified employees Wednesday of plans to close the company's manufacturing facility in Northeast Roanoke.

The company said 45 workers will lose their jobs. The closing will occur Jan. 16.

Shorewood's Roanoke plant converts rolls of paper into sheet stock that is shipped to Shorewood's packaging plants, whose products include packages for DVDs, video games and other entertainment and consumer product packaging.

Kenneth Reeves, Shorewood's segment human resources manager, said Wednesday the Roanoke work will shift to other plants.

International Paper bought Shorewood in 2000, and it then became part of International's consumer packaging group.

Shorewood also will close a facility in Springfield, Ore., costing about 100 jobs.

Kathleen Bark, a spokeswoman for International Paper, said the company decided to close the two packaging operations to match supply with demand.

duncan.adams@roanoke.com 981-3324

jeff.sturgeon@roanoke.com 981-3251

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