Nov. 14--Lockheed Martin announced Thursday that it will shutter its Akron plant along with some other operations around the country, but will continue some work at the Akron Airdock.
About 4,000 workers nationwide, including about 500 in Akron, are expected to lose their jobs.
The defense contractor, based in Bethesda, Md., said in a morning announcement it is making the moves "to increase the efficiency of its operations and improve the affordability of its products and services. These actions are in response to continued declines in U.S. government spending."
By mid-2015, Lockheed plans to close operations in Akron, Newtown, Pa., Goodyear, Ariz., and Horizon City, Texas; and four buildings on its Sunnyvale, Calif., campus.
On its website, Lockheed said "with the exception of the Akron Airdock, operations in Akron are planned to close by early 2015." Work possibly will be moved to Owego, N.Y., and Orlando, Fla.
The plans are expected to be finalized early next year.
The company has about 600 workers in Akron and 500 are expected to be impacted. It said the Akron closure "is expected to save millions annually and reduce the company's footprint by 677,000 square feet."
The airdock, which has a long Akron history with Goodyear blimps and airships, is owned by an entity called the Development Finance Authority of Summit County, which is an economic development arm of the county government. Lockheed signed a 20-year lease with the authority in early 2006.
That agreement requires the company to maintain the facility and monitor environmental issues there.
Authority President Chris Burnham described the financial terms of the lease as "really nominal" and declined to provide a specific figure. He said the payments are nominal because of the cost of maintaining the facility.
Burnham estimated that Lockheed has spent about $30 million on improvements and environmental cleanup at the site.
"It's a really unique building and it has some value to them," he said.
One Pentagon official called the building "a national asset" during a visit, Burnham said.
As of Thursday morning, he had not spoken with Lockheed about its plans for the airdock.
Summit County Executive Russ Pry said local officials have worked hard to try to help Lockheed with government funding and keep it in the community.
"That's a very sad day for our community," Pry said. "There are a lot of good people who have been over at that facility their whole careers who will be impacted by this."
Representatives of Akron Mayor Don Plusquellic and the offices of Sen. Sherrod Brown and Sen. Rob Portman appeared to be caught off guard by the announcement and were unprepared to react to inquiries.
Here is the entire news release issued by the company Thursday morning:
Lockheed Martin to Consolidate Facilities, Reduce Costs
BETHESDA, Md., Nov. 14, 2013 -- Lockheed Martin [NYSE: LMT] announced today that it will close and consolidate several of its U.S. facilities and reduce its workforce by 4,000 positions as part of its effort to increase the efficiency of its operations and improve the affordability of its products and services. These actions are in response to continued declines in U.S. government spending.
By mid-2015, the Corporation plans to close its operations in Newtown, Pa.; Akron, Ohio; Goodyear, Ariz.; and Horizon City, Texas; and four buildings on its Sunnyvale, Calif., campus. The facility closures will result in the elimination of 2,000 positions and ongoing operational efficiency initiatives will result in the elimination of an additional 2,000 positions in the Corporation's Information Systems & Global Solutions (IS&GS), Mission System and Training (MST), and Space Systems business areas by the end of 2014.
As part of the consolidation, all program work and some employees will transition to other Lockheed Martin facilities, creating operational efficiencies and reducing costs. Space Systems and IS&GS will transition work to its Denver, Colo. and Valley Forge, Pa. facilities. The Corporation is reviewing potential sites to transition the MST work, including its facilities in Owego, N.Y. and Orlando, Fla., and expects to finalize plans in early 2014. Details on each facility and the consolidation activities can be found on the company website.
"Reducing our workforce of dedicated employees and closing facilities are among the most difficult decisions we make," said Marillyn Hewson, Lockheed Martin Chief Executive Officer and President. "In the face of government budget cuts and an increasingly complex global security landscape, these actions are necessary for the future of our business and will position Lockheed Martin to better serve our customers."
The actions follow a strategic review of the Corporation's current facility capacity and future workload projections and are part of a continuing affordability initiative. Since 2008, Lockheed Martin has reduced overhead costs, cut capital expenses, removed 1.5 million square feet of facility space and made the difficult decision to reduce its workforce from 146,000 employees to 116,000.
The facility closures announced today will further reduce the Corporation's operational footprint by nearly 2.5 million square feet of facility space and lower overhead costs. Affected employees will receive job placement assistance and severance benefits to assist their transition.
Headquartered in Bethesda, Md., Lockheed Martin is a global security and aerospace company that employs about 116,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration, and sustainment of advanced technology systems, products, and services. The corporation's net sales for 2012 were $47.2 billion.
(c)2013 the Akron Beacon Journal (Akron, Ohio)
Visit the Akron Beacon Journal (Akron, Ohio) at www.ohio.com
Distributed by MCT Information Services
Original headline: Lockheed announces it's closing Akron plant
Most Popular Stories
- Criminal Investigation Opened Into James Foley's Death
- McDonald's Names Another U.S. President
- The Hip New Career? Farming
- Sahara Casino Rises Anew as SLS Las Vegas
- U.S. Supporters of Islamic State Get Close Scrutiny
- Student Startup Develops Date-rape Detector
- Job Market Shifts Complicate Yellen's Rate Decision
- Dems Losing Fear of Obamacare
- Chinese Coal Gas Boom Poses Climate Risks
- Deere Announces New Round of Layoffs