Maytag finanical inquiry sought by UAW

Maytag financial inquiry sought by UAW
Date February 24, 2006
Section(s) Local News

AP Business Writer

Maytag Corp. will lay off about 50 workers at its Newton washer and dryer factory today, union officials said, adding that they plan to seek an investigation into how the company has tumbled so quickly in the past few years.

The number of workers after the layoffs will be about 1,000, said Ted Johnson, president of the United Auto Workers Local 997.

Last August, the company laid off 200 workers causing the factory to dip to its lowest work force level in nearly 60 years — about 1,000.

About 50 workers had been called back since then, the union said.

The plant’s work force was 2,600 in 2001.

Johnson also said the company has stopped promoting the models of washers and dryers made in Newton, the home of the company headquarters.

He criticized CEO Ralph Hake for making comments that the company will not invest in the Newton plant or promote its products.

Johnson said he plans to send letters to Iowa Attorney General Tom Miller and New York Attorney General Eliot Spitzer “to investigate how this American icon could be totally dismantled in the few years that Mr. Hake has been the CEO.”

Neptune, Atlantis and Dependable Care washers and dryers are made at the factory, which Hake has said is the company’s highest cost plant and that costs must be cut to earn future investment.

“The corporation claiming that it’s because of foreign competition simply isn’t enough, especially when Maytag Corporation refuses any attempt to market the products specifically made in Newton, Iowa,” Johnson said.

Maytag spokesman John Daggett said, “Employment adjustments take place occasionally at our plants across our system and it’s our policy not to release exact numbers regarding these or any level changes.”

The pending sale of Maytag also has generated nervousness that if rival Whirlpool Corp. is the new owner, it will close factories such as the Newton plant and the corporate headquarters.

Benton Harbor, Mich.-based Whirlpool, the nation’s largest appliance maker, has offered $1.79 billion, or $21 a share for Maytag. Including the assumption of $977 million of Maytag debt, the deal is valued at $2.7 billion.

Maytag and Whirlpool announced last week that antitrust regulators at the Department of Justice requested more time to review the acquisition, which will now not close before March 30.

Some industry analysts believe the deal may be rejected because it would concentrate up to 70 percent of the North American laundry appliance market in one company.


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