Rheem continues with production shift to Mexico

by The City Wire staff (info@thecitywire.com) 6,566 views 

Rheem officials have confirmed more production is being moved from Fort Smith to a plant in Mexico, but it is unclear how the move will change employment levels.

The transfer is part of a three-year plan the company announced in June 2011 to move some production and 250 jobs from Fort Smith to Mexico.

The company also announced in May it would cut 16 salaried jobs at its Fort Smith plant and a distribution center in Lewisville, Texas. A company official said at the time the move is not an indication the Fort Smith plant and its production is going away any time soon.

As of May, the company had 290 salaried and 900 hourly workers in Fort Smith, a reduction from the 300 salaried and 1,100 hourly as of June 2011.

The Rheem plant in Nuevo Laredo, Mexico, produces air conditioners and heat pumps, and is also producing residential heating and cooling equipment once made in Fort Smith.

Rheem officials issued this statement on Monday (July 23):
“On June 23, 2011, Rheem communicated the transfer of residential air conditioners and heat pumps to our Nuevo Laredo facility. Consistent with this strategy and our previous communications, yesterday Rheem announced internally the transfer of additional low volume residential products from our Fort Smith facility.

“Due to the seasonality of our industry and its impact on our production, staffing requirements vary through the course of the year. Because of that, we are evaluating what, if any, impact will occur with our staffing.

The Fort Smith plant continues to be a key manufacturing facility in our global business plan. While we cannot make promises or guarantees in these uncertain economic times, we continue to invest in capital improvements for the future of the Fort Smith plant.”

Rheem is based in Atlanta, with manufacturing plants in Fort Smith, Montgomery, Ala.; Oxnard, Calif.; and Eagan, Minn.; and a parts distribution center in Randleman, N.C. In 1987, Rheem became a wholly owned subsidiary of Paloma Industries of Nagoya, Japan, the world's largest producer of gas appliances.

The company manufactures residential and commercial heating and cooling systems; tank, tankless, solar and hybrid heat pump water heaters; whole-home standby generators, controls, swimming pool and spa heaters; indoor air-purification products; and commercial boilers throughout North America and world markets. The company’s premium brands, including Raypak, Ruud and Rheem.

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