Thomson Ends U.S. Picture Tube Production

By Greg Tarr -- TWICE, 3/17/2004

Marion, Ind. – Thomson announced here Tuesday that declining demand for CRT picture-tube televisions has forced it to close its over 50-year-old picture-tube plant here and a related panel and funnel manufacturing plant in Circleville, Ohio.

Meanwhile, a fire broke out in the Marion factory about four hours after the closing was announced, causing about $750,000 in damage, the Indianapolis Star reported. Local fire officials suspect arson was the cause. The fire burned a 5,000-square-foot area, destroying about 600 picture tubes.

The decision to close the plants impacts 990 employees in the Marion facility and 545 employees in Circleville, Ohio, the company said. Employees in Marion were paid for a full three months, despite shutting the doors in the middle of the month. The Circleville glass manufacturing facility, which runs 24 hours a day, will be winding down over the next several days, the spokesperson said.

The picture-tube plant, which was originally purchased by RCA in 1949 from the Farnsworth Radio Company, recently had produced 25-, 31-, 32-, 35- and 36-inch screen sizes. The Circleville, Ohio plant was started in 1970 as a glass-panel and funnel facility for 19-inch televisions.

"From 2000 to 2006 we are expecting a 40 percent decline in the picture-tube business in North America," said a Thomson spokesperson. "That works out to about 11 million fewer units over that six-year period. This is a reflection of a change in consumer taste. People are going for different display technologies, including plasma, LCD and digital rear projection."

Thomson said demand for picture tubes produced in North America has also declined significantly in recent years due to increasing television and tube production in Asia and growing U.S. television imports. Imports of big-screen Asian-made TVs grew to 4 million units in 2003, up from 2.9 million units in 2002.

The change in demand has also caused Thomson to shrink its assortment of CRT direct-view products, including a likely decision to drop the 25-inch screen size and possibly one or two other screen sizes from its lines, the spokesman said.

Going forward, Thomson will acquire picture tubes from its very large screen (VLS) picture-tube plant in Mexicali, Mexico. It will also purchase components less expensively from other manufacturers in Europe, Asia and other sources, the spokesman said.

However, Thomson stressed the move was market related and not a casualty of outsourcing or shifting jobs to other markets.

Another factor impacting the direct-view CRT market was the escalating volume of television products being imported into the country from Asian manufacturers, the Thomson spokesperson affirmed.

However, the decision to close the U.S. plants was not made by new management involved in Thomson’s new joint venture with China’s TCL, the spokesperson said.

"The picture-tube plant was not involved in the TCL deal," said the spokesperson. "The decision was made by our board and management late last week and early this week."

The Thomson spokesperson said company employees at its Indianapolis offices are not affected by the decision.