Auto parts maker Superior Industries International Inc. (SUP), Tuesday announced the closing of its manufacturing facility in Van Nuys, California, which would ultimately result in the elimination of 290 jobs or 9% of its total work force. Superior explained the move as to effort to pull it out of the unprecedented business downturn as a stronger, leaner company.
Steven Borick, Chief Executive Officer and President said, "Nevertheless, it is imperative to right size our capacity in line with current and projected vehicle production while maintaining the leverage for future business opportunities."
The closure that is expected to be completed by the end of the second quarter of 2009 would save around $16.5 million, annually, in labor costs.
Van Nuys, California-based Superior said the closure would aid its effort to further reduce costs and align its capacity with a sharply lower demand for light vehicles.
The plant closure would also incur severance and other associated costs of around $2.1 million, most probably in the fourth quarter ended December 28, 2008. However, asset impairment charges have yet to be determined.
With remaining five plants in North America and joint venture in Hungary, Superior said it has sufficient capacity to accommodate current and expected production requirements.
At December 28, 2008, the net book value of manufacturing equipment and related fixed assets at the Van Nuys manufacturing facility was approximately $17.4 million.
SUP is currently trading at $9.85, down $0.34 or 3.34%, on a volume of 0.14 million shares.
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