By Derek R. Smith, Daily Reporter
dsmith@greenfieldreporter.com
GREENFIELD - Eaton Corp. has decided to close its Greenfield manufacturing facility - a move that will eliminate another 75 jobs in addition to the 30 previously announced.
"It's unfortunate," said Greenfield Mayor Brad DeReamer, who heard the news Tuesday after it was announced to local employees. "It's just another casualty of the recession, and I'm sure there will be more over the next year."
Eaton's plans are to transfer the local medium-duty truck transmission and hybrid power operations to existing facilities in North Carolina and Mexico. A decision on where to relocate Eaton's local clutch remanufacturing operations has not yet been made, according to a company statement e-mailed to the Daily Reporter.
The moves are expected to be finalized by the end of October.
"The decision was based on an effort to develop a more flexible and efficient strategy for transmission and clutch production," the Eaton statement said. "The change will also provide more immediate response to local customer needs, while maintaining strong business results throughout the economic cycle."
The company, like many in the hard-hit automotive sector, is ailing. In January, Cleveland-based Eaton announced that its fourth quarter earnings plummeted 36 percent due in large part to the recession. The firm also announced that it was cutting 5,200 jobs, in addition to the 3,400 eliminated in 2008. The cuts are intended to help Eaton reduce costs by $125 million in 2009.
Worldwide, Eaton has cut back its global workforce by about 10 percent, down from a high of around 80,000 employees.
Eaton announced in January that it would eliminate 30 local jobs as it transitioned its local heavy-duty remanufactured transmission business to a third party. Eaton also said it was reducing its Truck Group workforce by 16 percent worldwide. It said at the time that it would assess the future of the Greenfield operation.
The Greenfield employees will receive a severance benefit package, as well as outplacement services, according to Eaton's statement.
"It will be a fairly measured phase-out over the course of the next several months, ending in October," said Don Alles, communications manager for Eaton's Truck Group. "We are very proud of the work that our employees have accomplished in Greenfield over the past dozen or so years. We regret that these actions are necessary."
Eaton ranked 207 last year on the Fortune 500 list of America's largest corporations, according to http://money.cnn.com. The firm had revenues of $15.1 billion for 2008.
Eaton's Greenfield facility opened in October 1996 and is part of Eaton's Kalamazoo, Mich.-based Truck Group. The Truck Group had revenue of $2.25 billion in 2008 and has about 20 manufacturing facilities worldwide. Customers for the local plant include major trucking companies such as Freightliner LLC and Volvo Group.
Eaton is well-known for its local philanthropic efforts - from employee volunteering to its support of local non-profits. Just last week, Eaton's Greenfield employees were awarded the local Community Spirit Award by United Way of Central Indiana for the firm's excellence in fundraising and community service.
"This is very disappointing news," said Paula Jarrett, Hancock County area United Way director. "My heart just goes out to those folks. It's a loss to the community not just for jobs but because they are a very philanthropic company. They contributed a lot in terms of time and money to the non-profits here. They will be missed."
Eaton has been a strong supporter of the Boys & Girls Clubs of Hancock County, contributing a total of $20,000 over the past two years alone.
Darren Turner, executive director of the local non-profit, was surprised to hear of Eaton's departure. He said the local employees he talked to last week at the annual United Way celebration were optimistic.
"I hate to see that happen because that's been one of our larger supporters," Turner said.
"Businesses like that it's hard to lose in the community because they do so much good for everybody."
Companies across the nation are dealing with the recession on a "week by week" basis, DeReamer said, adding that as a former business owner he understands about making tough choices.
DeReamer said his economic development team is working to subdivide empty buildings and bring in smaller companies to the city.
"We lose a great company. We're sad to see it go," he said. "On the positive note, we've got to go out and find some new companies to replace them. Hopefully, they will be successful."