Kobelco to lay off 75% of its workforce at South Carolina excavator plant
By Jenny LescohierApril 19, 2021
Kobelco Construction Machinery plans to lay off 75% of its workforce at its Moore, South Carolina excavator plant due to issues with its engine supplier, Hino Motors, according to media reports.
The layoff will include 102 of the plant’s 131 employees, effective May 1.
Reports said Tokyo-based Kobelco has decided to suspend production of all seven of its hydraulic excavator models after it learned in January that Hino was unable to obtain EPA certifications for its model-year engines “with no clear outlook on future supply schedule.”
“Kobelco Japan made a decision to run out of current engines we have on site and will suspend production until the engine issue has been resolved,” Kobelco General Manager Ralph Wabnitz was quoted. Affected models include: SK170LC, SK210LC, SK260LC, SK300LC, SK350LC, SK390LC and SK500LC.
The current supplier now makes an updated diesel engine, and it has changed the configuration of its production line to manufacture that new engine, company officials said.
“The plant will stay open until a decision about the future of this facility is made,” Wabnitz said. “The suspension of production was not a local decision, rather a decision made by our headquarters in Japan.”
Many employees will either get severance packages or help finding new employment.
Spartanburg County Councilman David Britt said when he learned in February of the pending layoffs, he reached out to state and federal officials to help Kobelco’s supplier obtain its engine certification.
“But due to Covid restrictions, it has made their efforts difficult,” said Britt, who chairs the county’s economic development committee.
“It is terribly unfortunate to Kobelco and their associates for this to happen at a time when their sales are sky high and their workforce is growing rapidly,” Britt said.
In an earlier report, the company said it would continue its business in North America during the suspension, “including the sales of models other than those subject to this suspension (various mini-excavators, 7ton/13ton class hydraulic excavators and the crawler crane CK3300G) and after-sales service for machines already delivered.”