Source: The Post & Courier post
WEST COLUMBIA, S.C. – Japanese automotive supplier Akebono Brake Corp. will shutter its West Columbia, S.C. plant by September as part of a company-wide consolidation that follows slumping sales to a key customer.
Akebono, in a June 1 letter to the South Carolina. Department of Employment and Workforce, said 351 workers will lose their jobs because of the Lexington County shutdown.
“After significant contemplation, Akebono has made the decision to close the West Columbia plant … due to a decline in its U.S. business,” Richard Cabadas, the plant’s manager, said in the letter, adding “these employee layoffs will be permanent.”
The Midlands factory, which was opened at a cost of $104 million in 1999, makes disc brake calipers for passenger vehicles.
Akebono also is closing a plant in Clarkesville, Tenn., this summer. Its roughly 320 workers make disc brake calipers, disc rotors and drum brakes.
The company also plans to shutter a third of its four U.S. sites and is looking to sell some overseas factories.
Akebono first announced the closure plans last year, saying they are part of a company-wide restructuring to eventually bring all North American manufacturing under one roof.
The decision comes after General Motors started pulling back on purchases of Akebono products as part of the struggling U.S. automaker’s own restructuring, which included scaling back production of its slower-selling sedans and small cars.
GM accounted for 28 percent of Akebono’s global sales in fiscal 2015 — a figure that had been trimmed by one-fourth by last year, according to a report by Automotive News.
Akebono has also suffered from management and equipment maintenance issues, Automotive News reported, and last year it received a $517 million bailout from creditors and an investment fund to keep the company running. In its most recent fiscal year, which ended March 31, Akebono reported a 20.7 percent decline in global sales and a 9 percent drop in profit.
The company’s decline is a sharp contrast to a few years ago. In late 2015, it announced a $40.5 million expansion of its South Carolina plant to accommodate increased sales. The state provided Lexington County with a $200,000 grant at the time to pay for property improvements associated with the project.