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Lexmark Cuts 550 U.S. Jobs
LEXINGTON, Ky. — Lexmark says staffing cuts announced Tuesday as the company moves to eliminate its inkjet printer business will affect 550 workers in Lexington where the company is based.
A spokesman says about 350 of those jobs are full-time, and another 200 are contractors.
Lexmark announced Tuesday that it is cutting 1,700 jobs and closing a Philippines inkjet supply plant.
Spokesman Jerry Grasso says the cuts will leave about 2,300 full-time employees in Lexington by the end of the year. He says the majority of the affected workers will be told of the cuts on Tuesday.
Lexington Mayor Jim Gray said in a statement that "our hearts go out to the people who lost their jobs." Gray said he hopes Lexmark’s business improves as the global economy gets better.
http://www.sunstar.com.ph/cebu/business/2012/08/29/lexmark-close-mactan-facility-239925
Lexmark to close Mactan Philippines facility
LEXMARK International Inc. will be closing its manufacturing facility in Mactan, Cebu by the end of 2015, as the company announced it will be letting go of its inkjet business as part of their restructuring action to improve profitability.In a statement, Lexmark CEO Paul Rooke said the move will affect 1,700 jobs around the world, including 1,100 manufacturing jobs.
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The restructuring is expected to bring annual savings of $95 million for the company.
News of the company’s exit from the inkjet business broke in international news agencies Tuesday after Rooke issued a statement.
“Today’s announcement represents difficult decisions, which are necessary to drive improved profitability and significant savings,” he was quoted as saying. “Our investments are focused on higher value imaging and software solutions, and we believe the synergies between imaging and the emerging software elements of our business will continue to drive growth across the organization.
“As we move forward, we remain confident in our strategy, competitiveness and ability to create value for shareholders,” the statement said.
However, the company assured it will continue to provide service, support and aftermarket supplies.
The restructuring actions are expected to result in the reduction of inkjet-related infrastructure, positions in research and development, supply chain and other support functions.
Performance
The statement noted the closure of its inkjet supplies manufacturing facility in Cebu by the end of 2015 and eliminating inkjet development, which includes “costs related to facilities, tooling, equipment, contract termination, and scrapping in process inventory.”
Lexmark officials in Cebu assured that the closure of the Cebu facility does not mean they are dissatisfied with the performance of the workers.
RL Bandy, president and chief executive officer of Lexmark Research and Development Corp. (LRDC) here in Cebu said the eventual closure of the Cebu plant is “not an indictment of the performance of our people.”
“They’ve all done great. We are not moving production out of Cebu to another location,” he said.
The exit of their inkjet operations is a new direction the company is taking from being “hardware-centric” towards software development that provides business solutions.
With more people carrying mobile devices and no longer printing documents, the return of investment for inkjet printers has been low. “If people are not printing, we are not selling cartridges,” he said.
Human resources director Minchu Decena said the Mactan facility has a mix of operators, engineers, finance and human resources personnel. She said the company will work to place employees in vacancies in other departments within Lexmark. For those who cannot fill in other jobs, she assured they have a network of other companies within the Mactan Export Processing Zone (Mepz) that they can reach out to for functions in supply chain logistics.
Decena said they will take care of the affected employees, engage them in meetings to prepare them for their eventual exit.
Shared Service Center
With the easing out of the inkjet business and the shift, they see a bright light for their Cebu Shared Service Center. Its director Christophe Calligaro said they have been adding new activities related to the new business and it is important to them to continue to develop it.
Bandy is confident in the local talents available and said the success of their manufacturing, research and development and shared service center is because of the employees they have and named Cebu a “top key site” for their growing shared services center.
Between now and 2015, it will be “business as usual” for workers at Mepz, said Lexmark International Philippines Inc. president and chief executive officer Robert Keith Gerwig.
Reactions
He could not say what the company plans to do with the facility in Mactan after 2015, but said they will continue to serve customers in need of printers and services while gradually letting go of the workers.
Board of Investments (BOI) Governor for the private sector Gerardo Sta. Ana said the company cannot be faulted if they find that the product is no longer viable.
He admitted there is cause for concern for those who might lose the jobs, but said it can be considered positive that the closure is not because they think Cebu is not a good place to do business in.
Cebu Chamber of Commerce and Industry president Prudencio Gesta assured that Cebu’s business environment remains favorable, although the closure could have an impact on the locality in terms of displaced employees.
Cebu Business Club president Gordon Alan Joseph found it “a pity” that the manufacturing facility will be closing, saying Lexmark’s software operations has been growing over the years.
“Aside from displaced labor, we need to understand their issues so we can immediately address them. The question that comes to my mind is whether there are others thinking of closing or relocating. We really need to work on our competitiveness,” he said. He added that Cebu can learn how to retain and attract more investors from Lexmark.
For Mandaue Chamber of Commerce and Industry president Phillip Tan, talented employees will not have a hard time finding other jobs, especially those working in research and development.
Assistance
Bandy admitted there are some employees at the LRDC dedicated to the inkjet operations, but he could not say yet if they will be affected by the restructuring.Lexmark employs about 12,000 workers worldwide and over 3,000 of them are in Cebu.
The Department of Labor and Employment (Dole) pledged to give displaced Lexmark workers financial assistance.
Dole 7 Director Lilia Estillore said the agency will give financial assistance of not more than P1 million to a group or not more than P15,000 to an individual.
Estillore says that in the past years, more than 100 employees were retrenched by locators at Mactan Export Zone (Mez) and Dole gave them P800,000 to open a canteen.
“That is not a loan, hatag na sa Dole,” Estillore said. She said Dole monitors livelihood projects for retrenched workers.
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