Belden CDT Inc., a manufacturer of electronics cable, said Monday it is closing two U.S. manufacturing plants and will open a facility in Mexico in an effort cut operating costs starting late next year.
As part of the restructuring at its coaxial cable plant in Tompkinsville, Ky., and its data cable factory in Fort Mill, S.C., Belden, based in St. Louis, will take a second-quarter charge of up to $2 million related to asset impairment and depreciation.
The two plants, which together employ 315 workers, will close in late 2007. Belden expects to record related severance charges of $3.6 million over several quarters. Most of the production will be shifted to a new facility near Nogales, Mexico, which will get about $30 million in capital investment.
"We need a lower cost source for the products currently manufactured in Tompkinsville and Fort Mill in order for them to be more cost competitive and to meet our profitability objectives," said John Stroup, President and Chief Executive Officer. "Establishing additional capacity in Mexico is an important step in our overall plan to increase our manufacturing presence in low-cost regions near our major markets."
The restructuring is expected to save Belden about $12 million annually, starting in late 2007, Stroup said.
The new Nogales plant will be the company's third manufacturing location in Mexico. Belden currently operates two manufacturing sites in Mexico, one in Nogales and one in Tijuana.