BENTON HARBOR, Mich., May 10, 2006
Whirlpool To Cut 4,500 Jobs
Consolidates Operations After Buying Rival Maytag
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A customer looks at a Whirlpool washer in Garden City, Mich., last summer. (AP)
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The former Maytag plants being closed are in Iowa, Illinois and Arkansas, Whirlpool spokesman Dan Verakis said. Whirlpool said it will also close the former Maytag corporate headquarters in Newton, Iowa.
The laundry plants being closed will be consolidated into Whirlpool factories in Ohio, said Verakis. The administrative offices will be consolidated into Benton Harbor, where Whirlpool is based.
Former Maytag administrative offices in Canada and Mexico will be consolidated into Whirlpool offices in those locations, Verakis said.
As part of the consolidation, Whirlpool said it will create 1,500 positions at other unspecified locations, for a net loss of about 3,000 jobs.
"We are taking these actions to rapidly restore the competitiveness of the Maytag brands," Jeff M. Fettig, Whirlpool chairman and chief executive, said in a statement. "This is an important step in our integration process that will allow us to drive continuing performance improvements and will better align our brands, products and operations with the markets we serve domestically and globally."
Whirlpool got the green light from federal regulators for its $1.79 billion purchase of Maytag Corp. only in late March.
The existence of strong rivals and the cost savings the new company would generate indicate "this transaction is not likely to harm consumer welfare," the Justice Department said.
"The loss of jobs in this community will not be easy to swallow, which is why we must begin acting right now to support this community and its workers during their difficult transition period," Iowa Gov. Tom Vilsack said in a statement.
Web Exclusive: Herrin, Illinois, mayor Vic Ritter tells CBS Radio News' Mara Rubin that the Whirlpool plant closing will hurt his city. "There's a lot of good people out there. I just now got done talking to a lady who's been out there 10 years, and we kind of had a little cry together," Herrin, Illinois, mayor Vic Ritter told CBS News. "We're going to continue talking to them, trying to get them to reconsider. If we can't do any good there, we're going to pull ourselves up by the bootstraps and we're going to go on."
But Ritter said Whirlpool left a bad taste in his mouth.
"I haven't been contacted by any people that we were negotiating with, so my disappointment has turned a little bit to anger, that they would think so little of the people of Herrin to not even contact their mayor," he said, although he did get a call from a lower-level manager.
Some analysts and antitrust lawyers had expected the Justice Department to object to the deal. The merger created a company producing half of the dishwashers in the United States and more than 70 percent of the clothes washers and dryers.
Such a rise in market concentration has typically drawn a challenge from the government.
©MMVI, CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.
