Citing ``recent unprecedented declines in demand,'' officials with top compounder PolyOne Corp. said Jan. 15 that the firm will eliminate 370 jobs — or about 8 percent of its global workforce.
The company also will close its PVC compounding plant in Niagara, Ontario, and the reduce work schedules of an additional 100-300 employees. The Niagara plant employs about 50 and will be closed during the first quarter of 2009.
Reduced work schedules will be reached by closing some production lines and implementing shorter work weeks, spokeswoman Amanda Marko said.
Of the 370 job cuts, 180 will come from North America, including 30 at PolyOne's Avon Lake, Ohio, headquarters. The company will take a one-time pretax charge of $45 million, but the changes will result in pretax savings of $25 million to $30 million in 2009, and $40 million annually beyond that.
Executive salaries also will be frozen during 2009.
The announcement comes less than six months after PolyOne revealed plans to close eight plants, including seven in North America, and eliminate 150 jobs.
``When we announced the manufacturing realignment in July, we expected that our actions would be sufficient for the company for an economic slowdown that was principally U.S.-based,'' Chairman, President and Chief Executive Officer Stephen Newlin said in a news release.
``Since that time, we have observed a precipitous decline in global demand brought on by the recent worldwide financial crisis,'' he added.
``Accordingly, we are taking immediate additional actions to further reduce capacity and costs and prepare ourselves for what may be a prolonged economic downturn.''
The Niagara closing is the third such move to affect PolyOne's PVC compounding business. In July, the firm announced it would close a PVC compounding plant in Plaquemine, La., and part of a PVC compounding operation in Avon Lake.
PolyOne's sales in the first nine months of 2008 increased 10 percent to $2.2 billion vs. the year-ago period. Profit more than doubled to $9.7 million in the same comparison.
PolyOne ranks as North America's largest compounder, with a market share estimated at 9-10 percent.
``We recognize that our announcement today has far-reaching impacts on our associates, their families and the communities in which we operate,'' Newlin added in the release. ``However, this urgent and aggressive response is prudent and required to ensure that PolyOne remains competitive.''