From MEMA Industry News
SAN FRANCISCO — Aftermarket Technology said late Thursday it will write off $16 million to $20 million worth of assets and take a $2.6 million charge to close a plant in North Carolina after losing a manufacturing contract from General Motors.
Aftermarket Tech said the noncash charge of up to $20 million, or 76 cents to 92 cents a share, would be recorded in the third quarter.
The Westmont, Ill.-based company supplied General Motors with remanufactured transmissions. With the loss of the contract, the company said it would close a facility in Gastonia, N.C., as soon as possible. It will take a one-time charge of $2.6 million, or 12 cents a share, primarily in 2004.
Starting Friday, 200 people would begin to lose their jobs due to the plant closure, according to Mary Ryan, Aftermarket Tech’s vice president of investor relations and communications. She said it wasn’t yet clear when the plant would be completely shut down.
Shares of Aftermarket Technology closed down 2 cents at $12.44 Thursday ahead of the announcement.
Ryan added the company was advised by General Motors two days ago that it had decided to resource the remanufactured transmission work elsewhere. GM didn’t say why it decided to end the contract, she elaborated, nor was told which vendor, if any, will be awarded the work of rebuilding the transmissions.
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