From: Human Rights Coordinator <hrcoord@igc.org>
Newsgroups: soc.culture.mexican
Date: 22 Jul 92 09:48 PDT
Subject: US Jobs To Indonesia?
Nf-ID: #N:cdp:1545800046:000:4518
Nf-From: cdp.UUCP!hrcoord    Jul 22 09:48:00 1992


From: Human Rights Coordinator <hrcoord>
Subject: US Jobs To Indonesia?

/* Written  5:41 pm  Jul 21, 1992 by apakabar in cdp:reg.indonesia */

   AP, Cortland, NY, July 21 - Smith Corona Corp., the last American
typewriter maker and a dominant force in word processing, stunned
workers and government officials Tuesday by announcing it will move
manufacturing to Mexico.
   The pullout, which will begin in 60 days and take about a year to
complete, will mean the loss of 775 permanent local jobs and 100
temporary positions.
   Smith Corona blamed what it called predatory pricing by foreign
competitors and the U.S. government's lack of support for the decision
to join the growing number of U.S. manufacturers relocating south of the
border, where labor rates are much cheaper.
   "We can't remain competitive in Cortland," said President and Chief
Operating Officer Bill Henderson said at a news conference in the
upstate New York community where Smith Corona has been a business pillar
for four decades. "We tried restructuring, we tried product redesign, we
tried cost-cutting, but there's nothing more we can do."
   "It's an American tragedy," he said.
   Workers and local politicians used a different word to describe the
pullout: "betrayal."
   "What bothers us is that you look at their stocks and earnings and
they're going up," said Alan Parker, a toolmaker with Smith Corona for
27 years.
   The announcement coincided with the company's report that earnings
for the fiscal year ended June 30 jumped about 13 percent compared with
the year before.
   "The place is making money, just not as much as they want. We can't
help but feel they're dumping on us and going somewhere for a better
profit," Parker said.
   Cortland Mayor Ronald Walsh Jr. said it was hard not to feel "a
certain sense of betrayal" against Smith Corona.
   "The bottom line is we will lose 775 jobs here to Mexico where they
pay much, much less," he said.
   Local officials said they had no forewarning about Smith Corona's
announcement.
   Workers learned about the move Tuesday morning just before Henderson
told reporters.
   "People were too stunned to react," said Bassam Chamoun, a software
engineer who said his job is safe -- for now. "We have been loyal and
faithful to the company. This is like breaking a marriage vow."
   Henderson said the decision to cease production in Cortland was made
at a company board of directors meeting Monday at Smith Corona's
headquarters in New Canaan, Conn.
   "Until the decision was made, I don't think anyone thought it would
be appropriate to alarm the employees or the community," Henderson said.
   Smith Corona is the largest employer in the county, about 30 miles
south of Syracuse.
   The move to Mexico will allow Smith Corona to cut production costs by
80 percent and save $15 million annually, Henderson said.
   Smith Corona reported net income of $22.1 million, or 73 cents per
share, on net sales of $371.7 million for the full year ended June 30.
That compared with earnings of $19.6 million, or 65 cents a share, on
net sales of $383.4 million a year earlier.
   G. Lee Thompson, chairman and chief executive officer, said Smith
Corona will leave 370 employees in Cortland to maintain its worldwide
engineering, product design, customer service and administrative support
divisions.
   The company said the site it will relocate to in Mexico would not be
announced until negotiations, now in their final stage, are completed.
   Thompson said closing the Cortland plant was the most difficult
business decision he's ever made.
   "We probably stayed a year or two longer than we should have," he
said. "But we were willing to pay premium labor rates in hopes of
finding a way to stay."
   He said Smith Corona was forced to move "as a direct result of these
(foreign) competitors openly thumbing their noses at our trade laws."
   Thompson said the company would offer all affected workers a benefits
package and job placement services to soften the impact of the closing.
   Smith Corona, which began in Syracuse as L.C. Smith & Co., moved to
Cortland in the early 1950s. Over its 110-year history, it has outlasted
all other American industry leaders, including Royal, Underwood and
Remington.
   At its peak in Cortland, Smith Corona employed 4,200 people in 1979
in the manufacture of higher priced electronic typewriters and word
processors.
   All Smith Corona products will now be manufactured overseas. The
company also has plants in Singapore and Indonesia.