Plymouth Rubber Co. Inc. will discontinue manufacturing at its Canton plant within the next three years and transfer production to a factory being built in China and to other facilities.
About 275 of 350 employees at the Canton facility - which makes rubber and plastics products, including a variety of tapes and films - will be affected by the move.
The job cuts are to begin next year.
The remaining 75 employees - mostly in sales, administration and research - will transfer to a product-development center the company plans to open near Canton when it closes the manufacturing facility, according to President and Chief Executive Officer Maurice Hamilburg. A decision on the exact location has not been made.
In December, Plymouth and Hebel Huaxia Group formed a joint venture, Plymouth Yongle Tape (Shanghai) Co. Ltd., in Shanghai, China, that is constructing a factory to produce tapes. It is expected to be operating within a few months.
PVC tape production eventually will relocate from Massachusetts to the Shanghai plant. The firm is considering a range of options for its rubber extrusion and rubber tape manufacturing, including possibly moving both to Plymouth's Denver plant or its factory in Spain.
Hamilburg said manufacturing eventually will end in Canton because the firm has had difficulty competing profitably from that location with companies that produce tapes in Asia.
``We have resisted the trend [to move production to China] for several years, but ultimately have concluded that this change in strategy is necessary for our survival as a manufacturer,'' he said. ``Our products' market prices are now determined globally, while costs are determined locally.''
Plymouth elected to let employees in Canton know early that the plant will close ``because we want to give them fair warning,'' the executive said. ``Some have been here a long time. Some are multigenerational; their grandparents worked here. This is a tough, sad thing to do.''
Laid-off workers will receive a minimum of a month's severance pay along with continuation of medical benefits during the severance period, Hamilburg said.
Plymouth is looking at a number of other manufacturing alternatives - including possibly outsourcing some production. It also may open one or two small plants to serve Tier 1 automotive suppliers in or near Mexico, Hamilburg said. The company might do some minor expansion at its facilities in Spain and Denver.
The company concentrates primarily on the tape business and manufactures its rubber and plastic goods for markets including electrical supply industry, utilities, automotive and highway striping.
The firm's sales increased 13 percent in the third quarter of 2004 to $18 million, while its net loss for the period decreased to $771,000 from a loss of $1.1 million in the 2003 quarter.