Kellogg's cuts Cary work force

CARY -- Local workers at Kellogg's biggest snack manufacturing plant in the nation received layoff notices Thursday morning.

The Battle Creek, Mich.-based company did not disclose how many jobs it's eliminating at its Cary factory but said the cuts there and at other sites are part of a program dubbed K-Lean.

The corporate acronym sounds like a healthful low-calory snack but actually stands for "lean, efficient, agile, network," and is designed to bring production closer to customers by shifting operations among manufacturing plants. The global food and cereal company is trying to trim $1 billion from annual operating costs by 2011.

Kellogg's spokeswoman Kris Charles said there are no plans to shut down the Cary plant.

"As we simplify and standardize our processes at the Cary bakery, some jobs were impacted," Charles said. "This isn't about meeting a specific headcount reduction, but rather ensuring we have the right streamlined structure in place to position the company to continue to deliver sustainable, dependable results."

Those cuts come on the heels of the nation's biggest cereal maker reporting healthy financial earnings for the third quarter. And two years ago Kellogg's announced a major expansion at the Cary plant that would add 180 people and bring staffing there to 800 workers.

Charles would not say Thursday whether the company followed through on its expansion plans. The company employs about 32,000 people worldwide; it would not say how many work at the Cary plant today.

"It's always a concern when one of your companies loses jobs," said Sandy Jordan, economic development director for the Cary Chamber of Commerce.

Jordan called to the Cary bakery on Thursday to offer the chamber's support, but he was directed to corporate headquarters.

The Cary facility manufactures Keebler crackers, Cheez-It crackers, Zoo animal crackers and Austin cookies, among other products.

In 2000, the facility employed about 1,200 people when it was owned by Austin Quality Foods. That year, it was bought by Keebler Foods, which was then sold to Kellogg's in 2001.

Earlier this year, the plant suspended production of all peanut butter snacks because its peanut butter supplier was tied to an outbreak of salmonella that sickened hundreds of people nationwide and resulted in one death in North Carolina.

Just last week, Kellogg's officials made an all-day presentation in Michigan on the K-Lean program to Wall Street analysts, not once mentioning layoffs, said analyst Beth Ann Loewy of Sturdivant & Co. The company is known for efficient operations, and Loewy considers Kellogg's one of the nation's best-managed foodcompanies.

But in the middle of a major recession, the company is under intense pressure to maximize efficiency and keep down costs.

Another Triangle snack manufacturer, ConAgra Foods, this week laid off the last of about 300 workers it cut at its Garner plant that makes Slim Jims. The decision followed an explosion at the factory in June that killed three workers and cut production in half.

Kellogg's is executingK-Lean over three years, from 2009 to 2011. This year the company began applying the program to its manufacturing operations, Jeff Arnold, Kellogg's senior vice president, told analysts. About 40 percent of the savings, roughly $400 million, will come from "plant driven initiatives," Arnold said.

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