Electronics components manufacturer Vishay Intertechnology Inc. (NYSE:VSH) is expanding its cost-cutting measures in Israel, and intends to fire 10% of its workforce at Vishay Intertechnology Israel Ltd. The company will fire 400 employees at its plants in Beersheva, Carmiel, Dimona, Migdal Ha'Emek, Holon, Netanya, Yehud, Or Yehuda, and Kanot.
The news comes a week after "Globes" revealed that Vishay had decided to reduce its activity in Israel, including closing down its plant in Yokne'am. Vishay Israel general manager Mark Zandman told "Globes" that the closure was due to the global economic crisis, and that the plant at Yokne'am was just one of the company's plants around the world that would be closed. He said, "The company has decided to focus, and to cancel some projects."
Vishay Israel's Yokne'am plant employed 15 people, and was based on start-up CyOptics, which Vishay acquired in 2005 for $10 million. The new round of layoffs is much more significant, since they mainly affect manufacturing staff in outlying areas, where alternative jobs are hard to find, especially during an economic crisis.
Histadrut Negev District chairman Meir Babioff told "Globes" today that the layoffs in Beersheva and Dimona were considered only the first massive wave of job losses in the area in the present crisis. He added that he was not surprised that Vishay made the layoffs.
Babioff said, "I knew that if it would happen, it would first come in the weakest place, which I call the 'electronics textiles', the low-tech industry that replaced the textile factories here. After all, we're talking about tying wires and cables."
Zandman said in response, "The global slowdown has resulted in a drop in demand for Vishay's products. In order to compete in the contemporary economy, the company must take measures that will ensure its status as a sound, profitable, and successful company. The company is doing everything it can to employ people on the affected production lines on other production lines, and to minimize the layoffs."
When asked if more layoffs were possible, Zandman replied, "It all depends on demand."
Published by Globes [online], Israel business news - www.globes-online.com - on January 28, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009