Welch Allyn shifting work abroad, blames pending medical-device tax

Mike Verespej

Published: September 17, 2012 6:00 am ET

Related to this story

Topics Medical, Public Policy

SKANEATELES FALLS, N.Y. (Sept. 17, 8:45 a.m. ET) — Global medical-device and diagnostic equipment manufacturer Welch Allyn Inc. said it plans to reduce its 2,750-person workforce by 10 percent over the next three years, partly triggered by the 2.3 percent excise tax on U.S. medical devices scheduled to go into effect Jan. 1.

The nearly 100-year-old family-owned company said it will close its manufacturing plant in Beaverton, Ore., and consolidate its North American manufacturing at its plant in Tijuana, Mexico, which opened seven years ago, and at its corporate headquarters plant in Skaneateles Falls, N.Y.

The Beaverton location will become one of three new product development and technology centers, with the others being in Skaneateles Falls and in Singapore.

Welch Allyn also said it will open a global finance shared service center for the company in Tijuana.

As part of the restructuring, 160 manufacturing employees in Beaverton and 45 employees in Skaneateles — where the company employs roughly 1,300 — will lose their jobs. The other 75 layoffs are expected to be voluntary buyouts of employees in Skaneateles Falls.

Those changes will reduce the Beaverton workforce to approximately 110.

“These actions will proactively prepare the company to address the onerous U.S. medical-device tax scheduled to begin in 2013 as mandated in the Affordable Care Act, as well as significant changes driven by health-care reform and market dynamics,” said the company in a news release announcing the restructuring and the workforce reduction.

Welch Allyn also said it would re-examine its operations in Europe and restructure its operations in Latin America to make them more competitive.

“We firmly believe this restructuring program is the right thing to do for the long-term success of the business,” said CEO and President Steve Meyer. “This restructuring plan will help us maintain competitive levels of investment in new products and technologies that are necessary to meet the changing needs of the global health care environment.”

Each laid-off employee will receive outplacement service, up to $4,000 in tuition reimbursement, and what the company termed “a generous severance package” — although it did not elaborate.

“We fully recognize the hardship it will cause some of our colleagues in the short term,” Meyer said.

Welch Allyn's global headquarters will continue its evolution into a high technology center and capitalize on demand for digitally enabled patient vital signs monitoring systems and diagnostic cardiology product offerings.

The Skaneateles Fall location also will absorb the patient monitoring, systems and low acuity vital signs product manufacturing operations from its Beaverton facility, the company said.

The Tijuana operations will absorb additional thermometer-probe cover, lamp and some blood-pressure cuff manufacturing operations currently done in Skaneateles Falls.


Comments

Welch Allyn shifting work abroad, blames pending medical-device tax

Mike Verespej

Published: September 17, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Integrated plastic/metal injection molding helps cars trim weight

October 2, 2014 11:17 am ET

Although it consumes a scant 9 percent of European plastics production, the auto industry is driving plastics research in the region, said Mathias...    More

Image

Helix gets FDA compliance for another medical device facility

October 2, 2014 10:50 am ET

Helix Medical LLC's Baldwin Park, Calif., facility has attained compliance with the federal regulation for quality systems for medical devices.    More

Image

Houston Plastic continues to grow with new press, controlled production area

October 1, 2014 11:32 am ET

Custom injection molder Houston Plastic Products Corp. has extended its clamp tonnage range and added an environmentally controlled molding area.    More

Image

Dow loses appeal in price fixing case

October 1, 2014 11:10 am ET

The Reuters press agency reports that a federal appeals court in Denver has rejected Dow Chemical Co.'s attempt to overturn a $1.06 billion fine...    More

Image

Brown signs California's plastic bag ban into law

September 30, 2014 1:38 pm ET

Gov. Jerry Brown (D) made it official today: plastic bags are banned across the entire state of California.    More

Market Reports

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 million dollar plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our industry analysis highlights macro industry trends and micro trends faced by companies that do business in Mexico. The report also provides key industry statistics and forecasts to anticipate future industry expansion.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Injection Molders Market Report & Ranking 2014

This special package contains our 132-page 2014 Market Report on the Injection Molding segment and our exclusive 2014 RANKINGS database of 500+ Injection Molders for a discounted package price.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events