Timken Cuts Laid Off 20 Workers

The Timken Company (USA; NYSE: TKR) laid off 20 workers from its plant in Honea Path, South Carolina. The layoff amounts to approximately 5% of the plant's 400 workers and was evenly distributed across hourly, salary and temp employees, both production and service. Weakening automotive demand was the ultimate culprit behind the need to make the cuts, although laid off employees who are qualified will reportedly be able to post for open positions when an expansion there is completed in summer 2007. South Carolina is home to a number of Timken manufacturing facilities -- Clinton, Walhalla, Gaffney, Honea Path, and Tyger River / Union. All except Tyger River are part of the Automotive Group. In late 2005, the company announced it would be closing the Clinton plant as part of an Automotive Group restructuring effort. Unlike the union overhead issues facing some auto industry suppliers, all of Timken's South Carolina plants are non-union; since 1954, South Carolina is a "Right to Work" state which means employees individually decide about union membership, rather than as a group. South Carolina's unemployment rate has been hit hard by the U.S. auto industry's larger problems, driving unemployment there to 6.3% recently. Laurens county's rate is slightly higher, at 6.6%. Spokesman David Williams told local media Timken had been addressing its cost structure at Honea Path in the hope of avoiding layoffs -- the first there in ten years -- but declining demand forced the issue. Mr. Williams said: "We do not take this as any indication of our loss in optimism for our plant, but rather a decision to be proactive in ensuring our long-term viability and competitiveness."