Kimberly-Clark Health Care will phase out operations at its medical device manufacturing plants in Utah and Idaho, consolidating operations for those devices at a facility in Mexico.
About 450 workers at Kimberly-Clark's Draper plant will be downsized or relocated to offices in Atlanta or Tucson over the next three years, the company said Tuesday.
"Market and competitive pressures have forced all manufacturers to manage costs more efficiently, and Kimberly-Clark Health Care is no exception," Joanne Bauer, president of Kimberly-Clark Health Care, said in a statement.
"We have come to the difficult but necessary conclusion that realigning our manufacturing operations will enable us to improve our operating efficiency and cost-competitiveness."
John Dodd, executive vice president of global operations for Kimberly-Clark Health Care, told the Deseret Morning News that no employees will be affected immediately by job reductions. The Draper and Pocatello, Idaho, plants will be phased out over the next two to three years, Dodd said.
Currently, 451 people work at the company's Ballard Medical Products facility, 12050 S. Lone Peak Parkway. Another 318 are employed in Pocatello.
"We'll be sitting down with our employees on a one-on-one basis to discuss their plans," Dodd said. "We'll be working with them and helping them prepare for their next career path."
The company will provide severance and benefits packages, along with employee assistance and career counseling services, he said. It likely will put the Draper facility up for sale around year's end.
Tuesday's announcement is part of Kimberly-Clark's global business plan, first announced in 2003. At that time, the Draper plant employed about 850 people, and the company said it would send 150 of those jobs to its plant in Magdalena, Mexico.
Over the past two years, nearly 40 percent of Kimberly-Clark's health-care manufacturing operations have been moved to Mexico, Dodd said.
"We're looking at how we can best reduce costs," Dodd said. "We're streamlining our operations into operations we already have in place. In terms of overhead and total costs to produce, we are leveraging quite a bit of cost savings."
In its second quarter financial statement filed last week, Kimberly-Clark said that the "initial phase of its cost reduction initiatives will take place between now and mid-2007 and will include the sale, closure or streamlining of 15 of the facilities and the expansion of three."
No information was disclosed at the time about the three facilities slated for expansion. Nor was information released about the fate of Kimberly-Clark's Ogden facility, which makes diapers for the company's personal care division.
Joey Mooring, a Dallas-based spokesman for the company, said Kimberly-Clark is neither identifying any additional locations for closure nor speculating on how other plants may be affected by the implementation of the global business plan.
However, Mooring said, the company on Tuesday announced plans to expand operations at its Conway, Ark., facility, which makes adult and feminine care products.
Dallas-based Kimberly-Clark acquired Draper-based Ballard Medical Products in 1999 in a stock deal valued at $774 million. At last count, its health-care unit operates four plants in Mexico.
E-mail: jnii@desnews.com