CNH ANNOUNCES INDUSTRIAL CONSOLIDATION ACTIONS TO STRENGTHEN COMPETITIVE POSITION
In North America, the industrial consolidation includes the closure of manufacturing facilities in Illinois, North Dakota and Wisconsin. CNH also intends to increase the degree of outsourcing of non-core components from its facilities around the world and, as a result, will sell its component facility in Valley City, North Dakota, and its foundry in Racine, Wisconsin. In accordance with U.S. labor law, the company will meet with unions that represent employees at the affected facilities for discussions prior to finalizing these integration plans.
CNH expects to announce further actions later this year in other regions of the world.
"With our strong global and regional brands, we are committed to meeting the needs of our customers by achieving the premier competitive position in our industry," said Jean-Pierre Rosso, chairman and chief executive officer. "We have developed a comprehensive plan that not only will create value within the company, but will enable us to provide our customers with the industry's best products and services."
The consolidation plan calls for the closure of the Concord plant in Fargo, North Dakota, which produces air seeders, no later than 2001 with production moved to CNH's Saskatoon, Canada, plant. The Saskatoon plant will be the company's center for planter and seeder production for the New Holland and Case IH brands.
CNH's consolidation plans also call for the closure of the company's combine plant in East Moline, Illinois, and tractor production facility in Racine, Wisconsin, which are scheduled for no later than 2004. Production of current product lines will continue during this time. The company intends to consolidate production of combines for the Case IH and New Holland brands at the company's plant in Grand Island, Nebraska, while the manufacturing site for Case IH and New Holland row-crop tractors will be at a North American location to be communicated at a later date. These moves will be timed with the launch of new global product platform designs.
Manufacturing of some product lines will be transferred within CNH as part of the industrial organization consolidation. Hay and forage equipment will be transferred from the Grand Island, Nebraska, facility to the Belleville, Pennsylvania, plant, while skid steers will be moved from Belleville to the Wichita, Kansas, facility, where Case skid steer lines are currently manufactured. The Valley City component facility and Racine foundry are expected to be sold no later than 2001.
In Europe, the company has begun the initial steps of its consolidation, having sold a component plant in Hattingen, Germany, and announced plans to close a facility in Kissing, Germany, by September 2000. The company also closed the former New Holland headquarters near London, England, in June 2000.
In total, these integration consolidation actions will result in a global workforce reduction of approximately 1,800 employees. The company is committed to treating affected employees in a fair and respectful manner.
These actions follow the previously announced divestment of CNH facilities in Winnepeg, Canada; Hesston, Kansas; Breganze, Italy; and Manchester, England. The company continues to pursue the divestiture of its plant in Doncaster, England. When completed, these divestitures, which are in accordance with conditions under which regulatory agencies in North America and Europe approved the business merger of Case and New Holland, are expected to reduce CNH's global headcount by approximately 1,700.
CNH production facilities in North America will include: Belleville, Pennsylvania; Benson, Minnesota; Burlington, Iowa; Dublin, Georgia; Fargo, North Dakota; Goodfield, Illinois; Grand Island, Nebraska; New Holland, Pennsylvania; Racine, Wisconsin; and Wichita, Kansas.