Emerson to layoff 35 from Valparaiso facility

By Bowdeya Tweh, Times of Northwest Indiana
bowdeya.tweh@nwi.com

A Valparaiso manufacturing facility is planning to layoff 35 hourly employees as a result of the economic downturn.

Emerson Power Transmission, formerly McGill Manufacturing Co., notified the employees June 19 and the layoffs are effective today, according to Emily Acquisto, a spokeswoman for Emerson. The facility operates under a division of St. Louis-based Emerson Electric Co.

Acquisto said there will be about 300 Emerson employees left in Valparaiso after the layoff.

"This difficult decision is no reflection on the quality of these employees, who have served the company and our customers well over the years," a company statement said. "This is a necessary business decision based on declining demand for the industrial products and components we manufacture and the need to operate competitively and most efficiently to serve the needs of our customers worldwide."

An internal company document The Times obtained says that orders either slowed down or were cancelled in April and May causing the production load to decrease. Major customers also forecast order cancellations would continue because of economic conditions, the document dated June 18 said.

The Valparaiso facility manufactures bearings. Acquisto said Emerson, as a whole, manufacturers power transmission products, including bearings, couplings, gearing, chain,and other components used in industries requiring mechanical power transmissions such as aerospace, mining, steel mills and food processing plants.

In the first quarter that ended March 31, Emerson had a profit of $373 million, or 49 cents per share, down from $547 million, or 69 cents per share. The company had $5.09 billion in revenue in the first quarter this year, down from $6.02 billion in the same period last year.

Sales in the industrial automation segment, which includes Emerson Power Transmission, decreased to $960 million in the first quarter of this year, down from $1.18 billion in the same period last year.

Emerson Power Transmission purchased McGill Manufacturing in 1990.