Rheem shifts plans, will shut down Milledgeville plant

Rheem Manufacturing Corp. announced today that it will close its Milledgeville plant by the end of this year and consolidate operations in Arkansas and Mexico.

The announcement comes just four days after the more than 650 workers who were laid off last fall reported back to work.

The Milledgeville factory will operate at “limited capacity as dictated by market demand,” and its approximately 800 permanent employees and 400 seasonal workers will be reduced “over the course of the year,” according to a company news release.

“This is a very difficult decision for us, and we understand it will have a tremendous impact on our employees, their families and the Milledgeville community,” said Chris Peel, Rheem’s chief operating officer. “Unfortunately, the precipitous drop in new construction and the global economic crisis show no signs of short-term recovery, a situation which has forced us to take this difficult course of action.”

The heating and cooling industry is down about 40 percent since 2005, company officials said, and the residential products have been “hit hardest with decreased demand and increased cost pressures.”

“Rheem Manufacturing Corp. appreciates the support and goodwill it has received from the state of Georgia, Baldwin County and the city of Milledgeville during its 30-year history in the community, and we are proud of the contribution Rheem has made during that time,” Peel said. “The company is committed to supporting its employees and treating them with the utmost respect, dignity and empathy during this transition.”

Employees at the Milledgeville plant have feared for several years that the company would move the operation to a new factory in Mexico. In August, during the first of two mass layoffs last year, a work crew removed an entire assembly line from the Milledgeville facility.

“At this point in time, they’re still moving the equipment out,” local union president Jonas Young told The Telegraph earlier this month. “The employees are kind of edgy because they don’t know how long they will be there. ... They have two fears: How long will they be there, and where will they put people because they’ve moved around 300 to 400 jobs?”

In today’s news release, company officials said the company’s facilities in Fort Smith, Ark., and Nuevo Laredo, Mexico, “are best suited to meet the company’s current production and business demands.”