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Electrolux To Close El Paso Plant

7/16/2004 12:36:00 PM Eastern

Stockholm, Sweden — Electrolux reported today that it will close its El Paso, Texas vacuum cleaner factory and lay off the plant’s 850 workers and move this operation to another facility in Mexico.

This news was announced in conjunction with the company’s second quarter earnings, which fell 4.1 percent to $4.4 billion. The company’s profit declined to 24 percent to $163 million for the quarter, ended June 30, .For the first half the company generated sales of $8.4 billion and a net income of $234.6 million, which was down 39 percent compared to the same period next year.

Electrolux’s North American segment did perform well during the second quarter and first half of 2004. It had sales just over $1 billion and an operating income of $45 million. The company said shipments of major appliances rose 1.6 percent during the quarter for a total first half increase of 4.6 percent. Budget-priced floor care products did particularly well during the past three months, while air conditioner sales were down substantially from the prior year.

Electrolux officials blamed higher steel prices for the company’s troubles, but were upbeat that some market growth will take place during the remainder of the year.

Electrolux also reiterated a previously announced plan to close its refrigerator plant in Greenville, Mich., during the second quarter of 2005.