Superior Industries closing Arkansas wheel factory
Yesterday Superior Industries International, Inc. announced it will close its Rogers, Arkansas wheel manufacturing plant as part of an initiative to cut costs and increase competitiveness.
The firm expects to cease operations at Rogers by the end of 2014. Production will be shifted to other Superior manufacturing facilities, including those in Fayetteville, Arkansas, and Chihuahua, Mexico, and is anticipated to generate a net $15 million labour cost savings year-over-year. Approximately 500 jobs will be lost.
As a result of the closure, Superior expects to incur severance costs estimated to be $2.0-2.5 million. At June 29, 2014, the close of Superior’s second quarter, the net book value of fixed assets and manufacturing equipment at the Rogers location was approximately $22 million. Asset related charges in connection with the closing have yet to be determined, but are expected to be recorded primarily in the third and fourth quarters of 2014. Other costs to be incurred as part of the closure also have not yet been determined.
“This action follows a comprehensive review of the company’s cost position in what continues to be an intensely competitive environment,” said Don Stebbins, who joined Superior in May 2014 as its president and chief executive officer and member of the board of directors.
“Our board and management team remain focused on building an efficient, operationally stronger organization that can compete effectively with manufacturers around the globe. We appreciate the contributions of our team members at Rogers and will be providing assistance to them during the transition process,” Stebbins added.
Superior is the largest manufacturer of aluminium wheels for passenger cars and light-duty vehicles in North America. From its five plants in both the US and Mexico, the company supplies aluminium wheels OEMs. Major customers include BMW, Chrysler, Ford, General Motors, Mitsubishi, Nissan, Subaru, Tesla, Toyota and Volkswagen.