A restructuring plan that will close six Smithfood Foods plants by December 2009 is not expected to adversely impact the Clinton location, company officials said Wednesday. In fact, some displaced workers might actually find themselves relocating to the local facility.
Dennis Pittman, director of corporate communications for Smithfield Packing, said Wednesday that although final details aren’t worked out for the restructuring plan, it is possible that Clinton’s location could see some staff additions.
He also said there was nothing “on the drawing board” that indicated Clinton’s plant would experience the fate of the other six plants, which will shut their doors and leave some 1,800 employees out of work by the end of the year. In total, 3,000 employees will be impacted, but company officials have said many may be relocated to other Smithfield plants.
“The future looks very good for the facility here in Clinton,” Pittman said in a telephone interview. “Depending on the final plan, some of the displaced workers from other plants could wind up coming to Clinton.”
The six plant closings were discussed Tuesday as part of a larger announcement about Smithfield’s restructuring plan, which is expected to result in $125 million in annual cost savings by fiscal 2011.
A news release issued by the company indicates the plan is an effort “to consolidate and streamline the corporate structure and manufacturing operations of its pork group to improve operating efficiencies and increase utilization.”
Smithfield officials said the pork group’s new business model will “enhance the strength of its independent operating company approach ...”
“This plan will create true synergies between our independent operating companies and produce more opportunities to improve the bottom line in the future,” said C. Larry Pope, president and chief executive officer of Smithfield. “Combined with the several plant closures we have made over the last three years, this restructuring should improve operating rates dramatically, allowing us to shed low-margin business.”
As company officials look for ways to become more efficient, Pittman said it was certainly possible that Clinton would be “considered a place where some of this work could potentially come to.”
But, he said, “it’s too early to say for certain. We don’t have the final decisions at this point.”
The plant closings, Pittman said, were not a result of the economy but more a result of the acquisitions. “We’ve reached a point where it was time to look at the operating efficiencies.”
Smithfield accounts for a third of the U.S. processed pork market, and while pork remains the world’s most consumed meat by volume — above poultry and beef — exports are expected to slow from the mix of weakening economic growth and the strengthening of the U.S. dollar.
The Clinton plant employs approximately 1,400 people and is considered the city and the county’s largest employer.