GRAND RAPIDS â
Steelcase Inc. announced today plans to close three manufacturing facilities in North America and consolidate the operations to other Steelcase locations, including one in Mexico.
The closure of the Kentwood East plant in Kentwood, MI, as well as the Markham, ON, and Grand Prairie, TX, facilities will result in the loss of 750 jobs; 400 of the jobs are from Kentwood East.
According to company spokeswoman Jeanine Holquist, the restructuring is expected to save Steelcase approximately $35 million a year. Production at the Kentwood seating facility, which makes the high-end Leap and Think chairs, will move to a Steelcase facility in Mexico. The companyâs other North American plants will absorb production from the closure of the Grand Prairie and Markham facilities. Products currently manufactured at Grand Prairie include Host credenzas and tables and Akira tables. The Markham product lines include Answer panel systems and Ally seating. The Markham facility was a recent recipient of the Recycling Council of Ontario's "Environmentally Sustainable Business Award" and "Platinum Waste Minimization Award."
Holquist said Steelcase plans to move production over the next eighteen months. The hub of the companyâs business will continue to be in western Michigan, where Steelcase employs approximately 3,000 people.
In a statement released by Steelcase, President and CEO James Hackett said, "We continue to make improvements to our industrial system, which have left us with excess capacity to support current and anticipated future demand. Actions such as these are never easy, but reflect the need for the organization to be as fit as possible in the highly competitive environment in which we operate. The changes we are making are designed to support our customers with a more flexible and agile industrial model for the future."
Steelcase estimates the cash restructuring costs related to the plant closures will be approximately $45 million, with the majority relating to workforce reductions and some additional cost for manufacturing consolidation and production moves. Fiscal 2010 revenue for the global, publicly traded company was approximately $2.3 billion.
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