Heavy-Duty Brake Plant To Close, Move Production To Mexico

Haldex Brake Products Corp., a Swedish brake and suspension manufacturer for heavy-duty trucks, announced on October 8 that it is shuttering its manufacturing facility in Blue Springs, Missouri, laying off around 154 workers, and will be moving production to Mexico.

The move to Mexico is expected to save Haldex approximately 25 million Swedish krona, or around US$2.5 million annually, according to a company statement.

In its statement, Haldex said manufacturing costs in Mexico are "significantly lower" than in the U.S. 

Haldex, a subsidiary of Haldex AB, headquartered in Landskrona, Sweden, filed a Worker Adjustment and Retraining Notification (WARN) Act notice with the Missouri Office of Workforce Development on October 8. 

Layoffs will start on December 13 and will continue until the facility closes during the fourth quarter of 2020, according to the WARN notice. A few employees will be offered new positions within Haldex's U.S. operations, the company said.

As of press time, Walter Frankiewicz, senior vice president of North American Sales at Haldex, did not return FreightWaves' telephone and email requests for comment regarding the facility closing.

The move to Mexico is part of Haldex's plan, first announced in 2018,  to streamline the production of brake adjusters from the U.S. to other countries. Halting production at the Blue Springs facility marks the "final step" in the transition, the company said in a statement.

Brake adjusters, the company's largest product, will now be manufactured in Brazil, China, Hungary, India and Mexico.

The company expects its fourth-quarter earnings will be impacted by approximately 27 million Swedish Krona or around US$2.7 million as "one-off costs related to the change in production."

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