Dana Corp. said in an SEC filing yesterday that it intends to close eight manufacturing plants and downsize three additional facilities in the U.S. and Canada. The automotive and heavy-duty truck supplier, which has been in bankruptcy protection since March, reported that it stemmed its flow of red ink by 72% to a $356 million net loss in the third quarter versus $1.27 billion in 3Q 2005.
The company declined to indicate which plants or how many jobs will be affected, but said it will save between $60 and $85 million in operating costs. Dana CEO Michael Burns sent a letter to employees that said the company would specify which facilities will be affected within the next month.
“Overcapacity and high operating costs at our facilities in the U.S. and Canada are burdening our performance and negatively affect our financial results,” Dana stated in the SEC filing. “We expect to continue to move manufacturing capacity from the U.S. to lower-cost countries, such as Mexico, while maintaining and improving the productivity of our final assembly operations in the U.S.”
Dana continues previously announced closures and consolidation of manufacturing operations. The company is moving driveshaft machining from Bristol, VA, to its new operations in Mexico and its axle assembly operations from Buena Vista, VA, to its Dry Ridge, KY, facility.
The company restated its ongoing restructuring efforts to return to profitability, which also includes selling off its non-core businesses. In September Dana has agreed to sell its trailer axle manufacturing business to Hendrickson USA for about $38 million in cash.
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