3M announces layoffs; some jobs to be cut in Decatur
Jul 26, 2008 (The Decatur Daily - McClatchy-Tribune Information Services via COMTEX) -- MMM | Quote | Chart | News | PowerRating -- 3M Co. announced it will eliminate 300 jobs, including an unspecified number at its Decatur plant, because of a drop in sales in its optical films.
The company will make the layoffs at its Decatur plant and a plant in Menomonee, Wis.
The Decatur plant employs 830 workers at an average pay of about $50,000 a year. It paid $120 million for its optical plant, which has struggled with profit margins since it began.
3M's optical film products are used in flat-screen televisions, computer monitors mobile phones and handheld computers.
The Decatur plant's production of films for large-screen televisions has been problematic. A single blemish on the film sends it to the trash can, according to 3M Chief Executive George Buckley in an earnings conference last year. Avoiding such blemishes on wide sheets of film is proving difficult.
The majority of the layoffs will be in the United States, comprising about 20 percent of its optical films staff.
The company reported Thursday that its second-quarter earnings received a boost from a 10 percent increase in net sales. Most of that increase came from international sales.
3M's optical business, however, was dismal in the second quarter. Profits fell 54 percent, and sales were down 36 percent. In an earnings conference, officials blamed the drop on the popularity of Vizio LCD televisions, which use a low-end optical film not offered by 3M. The competition forced 3M to cut prices on its optical films twice.
The company said that in addition to the layoffs, it will consolidate some manufacturing facilities. Spokeswoman Jacqueline Berry said Friday that plans are not final, but her understanding is that the consolidation will not affect the Decatur plant.
The measures should save the company $30 million annually, Berry said.
Local 3M officials declined comment.
The company will make the layoffs at its Decatur plant and a plant in Menomonee, Wis.
The Decatur plant employs 830 workers at an average pay of about $50,000 a year. It paid $120 million for its optical plant, which has struggled with profit margins since it began.
3M's optical film products are used in flat-screen televisions, computer monitors mobile phones and handheld computers.
The Decatur plant's production of films for large-screen televisions has been problematic. A single blemish on the film sends it to the trash can, according to 3M Chief Executive George Buckley in an earnings conference last year. Avoiding such blemishes on wide sheets of film is proving difficult.
The majority of the layoffs will be in the United States, comprising about 20 percent of its optical films staff.
The company reported Thursday that its second-quarter earnings received a boost from a 10 percent increase in net sales. Most of that increase came from international sales.
3M's optical business, however, was dismal in the second quarter. Profits fell 54 percent, and sales were down 36 percent. In an earnings conference, officials blamed the drop on the popularity of Vizio LCD televisions, which use a low-end optical film not offered by 3M. The competition forced 3M to cut prices on its optical films twice.
The company said that in addition to the layoffs, it will consolidate some manufacturing facilities. Spokeswoman Jacqueline Berry said Friday that plans are not final, but her understanding is that the consolidation will not affect the Decatur plant.
The measures should save the company $30 million annually, Berry said.
Local 3M officials declined comment.
<< Home