Teleflex to stop manufacturing in Asheboro; eliminate hundreds of jobs

dranii@newsobserver.comMay 30, 2014 

Medical device maker Teleflex plans to shut down its manufacturing operations in Asheboro over the next three years, a move that will trigger layoffs of a “significant majority” of the company’s more than 600 workers.

Bonnie Renfro, president of the Randolph County Economic Development Corp., said the company’s announcement is the worst economic news the county has had in years.

“This decision will have a significant negative impact on our community – and, most especially, on the workers and their families,” she said. Asheboro is about 75 miles west of Raleigh.

The move by Pennsylvania-based Teleflex is part of a broader restructuring plan that includes closing a second manufacturing plant in Menlo Park, Calif. However, a Teleflex executive said the company remains committed to its previously announced expansion plans for its operations in the Triangle, where it employs about 450 workers today.

Teleflex announced in November that it was consolidating its Triangle operations to a facility in Morrisville where it has room to grow. The company plans to create 75 jobs and invest $25 million over the next three years, which would make it eligible to receive $200,000 in incentives from Morrisville.

Teleflex, a publicly traded company that generated $1.7 billion in revenue last year, doesn’t have any manufacturing operations in the Triangle. But several of the company’s product divisions are headquartered here, and the company also has workers in sales, marketing, quality and regulatory assurance and research and development.

“It is quite a broad set of capabilities and staff,” said Cam Hicks, global vice president of human resources.

In Asheboro, Teleflex makes medical catheters and sterile surgical kits at its Arrow International plant, where it has has 470 employees plus 165 contract workers. Teleflex acquired Arrow in 2007.

Teleflex will keep some nonmanufacturing operations, such as a product sterilization group, in Asheboro. Hicks said it was too early to say how many jobs will be left but said that a “significant majority” of the jobs are being eliminated.

The manufacturing operations will be phased out over three years. No one has yet been laid off, and Hicks said that he anticipated that no more than 20 workers will be affected this year.

When the company announced its plan to its Asheboro workers this week, it committed to providing workers with a minimum of 90 days’ notice, he said.

The company also is offering a “fair and competitive” severance package and has hired an outplacement firm to assist employees in finding work elsewhere, Hicks said.

Teleflex announced last month that it planned a restructuring “in response to continuing cost pressures” in the health care industry that would include “the relocation of manufacturing operations from certain higher-cost locations to existing lower-cost locations.” On that same day, the company announced its first-quarter earnings per share rose 20.3 percent on revenue that was 6.5 percent higher.

Much of the manufacturing work being done in Asheboro will shift to the company’s plants in Mexico and the Czech Republic, Hicks said.

Consequently, workers should be eligible for federal aid under the Trade Adjustment Assistance program, Renfro said.

Randolph County’s unemployment rate was 5.8 percent in April, less than half its peak of more than 12 percent during the recession, Renfro said.

Renfro said the decline was the result of “incremental hiring” by a broad range of companies.

She plans to market the pending availability of the Arrow plant’s skilled workers to other companies looking for new manufacturing sites.

The planned shutdown “can be a good opportunity for somebody else,” she said.

Ranii: 919-829-4877

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