Burdened by a money-losing operation in Ciudad Juarez, Mexico, injection molder Clarion Technologies Inc. is closing its plant in Ames, Iowa.
The Ames plant will shut down in March, eliminating 132 jobs, according to a notice received by Iowa Workforce Development. Permanent job cuts will begin March 14 and are scheduled to be completed by March 28.
The 80,000-square-foot, leased facility started production in late 2004, spurred by growing orders from Maytag Corp. That changed when Maytag was acquired by Whirlpool Corp. in 2005. The Ames Tribune said current Clarion customers include Electrolux AB, Hyundai and Sears.
Clarion blamed the closing on ongoing corporate operating losses, according to the Tribune. Company officials were not available for comment.
Clarion has been striving to retrench its U.S. factories that make parts for the home appliance, consumer products and automotive industries.
In January 2005, it sold its South Haven, Mich., plant and consolidated production into its Caledonia, Mich., facility. In the same year, it also restructured its operations in Iowa into one facility in Ames. In the summer of 2006, it moved its headquarters in downtown Grand Rapids, Mich., to its leased facility in Caledonia. In December, the firm was reported to be closing the Caledonia plant and moving production to Greenville, Mich., by the end of 2006.
Clarion opened the Ciudad Juarez plant to mold shelves, trays and other components for Electrolux and other original equipment manufacturers in the region. Yet, severe operating losses in Ciudad Juarez surfaced in the company's third-quarter report, which cited inefficient production, logistic difficulty from off-site warehousing, layout of the production floor and ``a very high labor-force turnover rate.''
With predominant focus on auto parts and consumer products in its early days, 9-year-old Clarion said it lost $5.8 million in appliance-related sales in the third quarter of 2006 from an unidentified major customer.
Through the first nine months of 2006, Clarion lost $7.87 million on sales of $97.1 million. For the year, Clarion lost $5.66 million on sales of $145.5 million.
With defaults on its senior loan agreement in 2006, the company reported that lenders have imposed constraints on operating capital, curtailing expenditures.
On Dec. 27, Clarion reached an agreement to borrow $4.4 million from Electrolux Home Products Inc. and will use the proceeds to pay off JPMorgan Chase Bank, which agreed to forbear from exercising remedies on Clarion's previous defaults until April 1.
After the Ames closure was disclosed Jan. 15, Clarion's stock fell to a historical low of 1 cent.