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Imation shutting down facility
140 jobs to be cut as Camarillo site closes this year
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More from CamarilloImation Corp., which makes digital storage and electronic devices, plans to close its Camarillo plant by the end of this year.
The company announced Tuesday that it would move all of its magnetic tape coating operations to its plant in Oklahoma, cutting about 140 positions.
About a year ago, Imation announced it would cut back operations in Camarillo, shrinking the work force at that plant by half, from 230 to about 110, by the end of this year. The new announcement came along with the company's second-quarter earnings report.
Imation anticipates the restructuring will cost the company about $20 million related to the Camarillo closure, with about half of that stemming from severance benefits and the costs of leaving the site.
Imation is offering severance packages based on years of service, giving one week's pay for each year, with a minimum of four weeks and maximum of 26 weeks of pay, said Brad Allen, Imation's vice president of corporate communications and investor relations. He said employees also are being offered help with healthcare costs and outplacement counseling.
A small number of people will be offered jobs elsewhere within the company, but most of the positions are being eliminated, he said.
The company expects to eventually save $15 million to $20 million a year from closing the plant, which should help offset projected declines in the company's magnetic tape profits.
Plant older than the city
The Camarillo plant was originally built by 3M in the early 1960s. In 1996, Imation was formed as a spinoff from 3M to handle data storage.
Camarillo Mayor Charlotte Craven said the plant has been around longer than the incorporated city and used to be the largest employer in town, although employee numbers have dwindled over the years.
"I was really disheartened this morning to hear they're closing and exiting," she said. "They've been a vital part of the city all along."
3M and Imation have not only been big employers in Camarillo, but the company and its employees have also been active donors and volunteers. It's tough for the community, which also has watched Technicolor's local presence shrink, Craven said.
Allen said it is never easy to close a plant, much less one that has been around for so long. "But it's part of being in a very competitive industry where you've got to optimize your business to maintain your competitiveness," he said.
Imation's main business was originally magnetic tape, but the product has been adding higher capacity at lower prices in recent years, driving down profits. Growing areas of business for the company include optical storage, such as CDs, and flash memory.
Magnetic tape represented about 34 percent of the company's revenue in 2007, down from almost 56 percent two years earlier.
Shift to Oklahoma
In the second quarter of this year, the company had $547 million in revenue, up 32.5 percent from a year ago, with growth driven by optical and consumer electronic products. Net income was $7.2 million, compared with a $1.4 million loss a year ago.
The company continues to forecast 2008 revenue at around $2.4 billion, about a 16 percent increase over last year.
A year ago, company officials said they were trying to work more efficiently to offset the lower cost of magnetic tape, launching a program that included the closure of a North Dakota manufacturing plant and outsourcing some of the operations in Camarillo and Weatherford, Okla.
The company also decided all of its coating operations could be done out of the Weatherford plant, which has $55 million worth of the latest coating equipment.
Imation owns part of the Camarillo facility and leases part of another building that the company sold in 2003. Allen said it is too soon to say what will happen with the site.
Craven hopes another company will move into that location, but she's not confident, because a nearby building has been sitting on the market. "I don't know if anything is going to come in or not," she said.
Posted by ebrockway on July 23, 2008 at 1:24 a.m. (Suggest removal)
Nope, nothing coming in. California is less friendly to business with stifling red tape and higher taxes than almost anywhere. That giant s*cking sound? It's businesses and taxpayers leaving California to anywhere but here.
Posted by probegtze on July 23, 2008 at 4:12 a.m. (Suggest removal)
It really isnt news to the employees though. We have all seen the writing on the walls for the last 5 years. Every year we all came to the same Mandatory Meetings. Every year for the past 5 we have shrunk smaller and smaller.
The fact is we make a old product for a Market that isnt really there anymore. We are taking our stuff and shipping it to be made in Mexico for cheap pay and labor. This isnt news. Companies have been doing this for along time now. To keep the Imation Company a float we needed to do this, and close Camarillo.
I prey that we all find better jobs. I for one hope to win the lottery. I hope that all my friends here bounce back from this minor set back. I had a great time and met alot of nice good people and friends while working here. I will honestly say I will miss the place.
Now go vote for McCain and this wont happen anymore....:)
Posted by heregoes on July 23, 2008 at 6:38 a.m. (Suggest removal)
I agree with ebrockway - I have found California and its hideous laws to be almost anti-business. And tax wise it is very expensive to do business here also.
I guess the liberal politicians just want a bunch of welfare recipients and unemployed people receiving federal aid.
Posted by frank14 on July 23, 2008 at 6:46 a.m. (Suggest removal)
With plans by the legislature and Governor Ahhnold to increase taxes on businesses to pay for the $15 billion deficit expect more companies to move to low tax states like Arizona, Utah and Florida.
Posted by ssakoian on July 23, 2008 at 7:11 a.m. (Suggest removal)
In the big picture, I don't really have a problem with Imation closing in Camarillo and heading to Oklahoma. It is still in the US. What I do have a problem with is all this closing of US plants and factories, not just in California, but nationwide - and shipping them to Mexico, China, Vietnam. This is just plain wrong. It might make "sense" economically - but it destroys our country's ability to employ its own people. With education closing down technical programs, our ability to create a well-paid blue collar worker decreases.
You can blame the Democrats, you can blame the Republicans - but trade treaties which defeat ourselves is self-destructive. Allowing produce from foreign countries in at lower prices leads to our own farmers failing. (It also permits salmonella.) Allowing cheap flowers from South America destroys our own local flower farmers. Allowing foreign conglomerates to buy and own massive amounts of American property and companies - especially when those buyers come from protectionist countries which forbid foreign owners of the same - is stupid.
The days of the Wild West are over, folks. Our far shore has been reached. We need to conserve, that meaning to retain and preserve, our own. That means our populations, our people, our lands, our resources. Rather than spreading our forces overseas in useless wars, we need to deal with problems on the domestic scene. Crime, illegal immigrants, diseases, poverty. We need to spend money to educate and employ, we need to provide social programs so that those who might head to gangs might not join them after all. Heck, when foreign fire fighters have to join us because all the California National Guard is fighting stupid and illegal wars, that is pretty sad - not that I am complaining about the aid, I am grateful - but why should we be in that position?
Maybe you think this comment naive, but the fact is, this country is always selling itself off to the highest bidder and the cheapest goods.
There has to be a healthy balance in here somewhere. Sending companies overseas for cheap labor may help in the short term, and help the foreign country, but it does not help us. Sending the company to another state at least keeps it in the US - but I wonder what sorts of worker's rights there are in Oklahoma.
We are very well cared for here in California - we take so much for granted that other states do not provide. Something needs to change . . . the question is, what???
Posted by cslaurie on July 23, 2008 at 7:24 a.m. (Suggest removal)
I agree with ssakoian: Here is a quote given at the Army of the Potomac reunion dinner.
...I have heard many reasons why the South failed in the Rebellion, and why with the help of Northern dissensions and a European hatred the South did not succeed. I will tell you. In my judgment, the South failed, not on account of its army, but from other conditions.
Luckily for us, the South had always been in favor of free trade.
Secondly -- The South raised and sold raw material, and when, the war came it had no foundries, no factories, and no looms to weave the cloth for uniforms; no shops to make munitions; of war, and it had to get what supplies it could by running the blockade.
We of the North had the cloth to clothe our soldiers, shops to make our bayonets; we had all the curious wheels that invention had produced, and had labor and genius, the power of steam, and the water to make what we needed, and we did not require anything from any other country.
Suppose this whole country raised raw material and shipped it out, we would be in the condition that the South was.
We want this Nation to be independent of the whole world. A nation to be ready to settle questions of dispute by war should be in a condition of absolute independence.
For that reason I want all the wheels turning in this country, all the chimneys full of fire, all the looms running, the iron red hot everywhere. I want to see all mechanics having plenty of work with good wages and good homes for their families, good food, schools for their children, plenty of clothes, and enough to take care of a child if it happens to take sick.
I am for the independence of America, the growth of America physically, mentally, and every other way. The time will come when all nations combined cannot take that flag out of the sky.
I want to see this country so that if a deluge sweeps every other nation from the face of the globe we would have all we want made right here by our factories, by American brain and hand.
Posted by Camman1 on July 23, 2008 at 7:57 a.m. (Suggest removal)
Sorry to hear Imation is leaving. Perhaps they could tear down that building - it is sort of an eyesore given all the new residential construction that has popped up around it...
Posted by rebel123 on July 23, 2008 at 8:37 a.m. (Suggest removal)
The tape industry is a dying market for sure. California is a difficult place to do business for many reason, not the least of which is the cost of land and triple net leases. I frankly doubt a vote for McCain is going to help business in California however. As to outsourcing our jobs overseas, that's greed pure and simple.
Posted by fungus on July 23, 2008 at 11:24 a.m. (Suggest removal)
Outsourcing is not greed... it's capitalism!
Posted by butterflygone on July 23, 2008 at 11:37 a.m. (Suggest removal)
I was uprooted a few times by my company moving to another state. First Kinko's Corporate, then Fidelity. I moved to the Phoenix area a year ago and work for a large insurance company that pays me more than I ever made in California. Something is definately wrong in Cali. Although it is my home state, and I love it, Cali needs to do right by the people living there. How are the people going to be able to live there if all the jobs are moving away?
The sweltering AZ heat is a killer, but I need to be where I am able to support my family.
Posted by 805grl on July 23, 2008 at 12:23 p.m. (Suggest removal)
butterflygone, where are the good jobs in AZ?? PLease let me know... Im ready to move out of here too!
Posted by ebrockway on July 23, 2008 at 1:27 p.m. (Suggest removal)
mmshoot;
Not so much the businesses that are folding, but the ones that are leaving this state to open viable businesses elsewhere.
D&G Automotive in Camarillo, mom and pop garage that also rented U-Hauls; packed up everything and moved to Montana because doing business here made no sense anymore. Who's tracking these departures? 2 or 3 employees had to find other jobs, no big deal, until we multiply by n and come up with...?
Even Hollywood makes it's movies elsewhere. I recently saw a movie where the set was supposed to be L.A., and the credits thanked the city of Ontario, Canada for their support and co-operation. No doubt about it (or no doot aboot it), Ontario thanked them profusely for employing their caterers, carpenters, etc. not to mention the city permit fees.
Vote (D) in November! Or vote (R) if they'll increase business and income taxes! And make sure whoever you vote for is willing to throw some new Enviromental laws on the books so California can "lead the way" on Green Issues. And unemployment, welfare, dropout rates, gang violence, local government corruption, etc.
Yay us!
Posted by rebel123 on July 23, 2008 at 1:47 p.m. (Suggest removal)
fungus: Capitalism is fed by greed. Think about it.
Posted by mikeb6804 on July 23, 2008 at 4:25 p.m. (Suggest removal)
I don't like the California business climate and I don't like ousourcing jobs. Both need to be fixed.
Posted by sparks240 on July 23, 2008 at 4:59 p.m. (Suggest removal)
If you don't like capitalism and greed, move to Cuba. Communisim is alive and well there.
Posted by onapproach on July 23, 2008 at 7:05 p.m. (Suggest removal)
I thought that plant closed a long time ago. The parking lot is always empty.
Posted by Tom_Johnston on July 23, 2008 at 8:07 p.m. (Suggest removal)
cslaurie: That quote who was it? I might regret saying this, but I think I'd like to vote for that guy right now!
I think the dangers of exporting, outsourcing basic production could in fact really backfire on is, if it isn't already.
We have the spectacle of a US Air Force refueling tanker being if not European built, European designed and supported...this is not good. Americans assembling planes conceived abroad??
The US Army berets....made in China??
We need to retain core production capabiity here, regardless of "capitalism" that serves noone but the elites and oligarchs.
Posted by ebrockway on July 23, 2008 at 9:22 p.m. (Suggest removal)
rebel123;
"Capitalism is fed by greed. Think about it."
So it's greed then if I work my tail off to start a business of my own, hire a few people, watch it grow, hire some more. Then it's gets bigger, product is popular so I expand by incorporating and taking on a few investors.
Now I'm a greedy corporate mogul? An evil corporation?
It's greedy to want to make something of yourself? Why do I have the feeling you haven't a greedy bone in your body?
Posted by cslaurie on July 24, 2008 at 7:21 a.m. (Suggest removal)
Tom,
It was from a speech to a reunion dinner of the Army of the Potomac in 1894, by Robert Ingersoll. I guess we had more folks then that understood what our country needed to survive.
Posted by narc121 on July 24, 2008 at 8:09 a.m. (Suggest removal)
I agree Camman1, they should just tear it down. The pollution that comes out of there is an eyesore to the new residential community and who knows what kind of toxic crap is in there.
It's very sad to see a company that has been around so long go under, but that's our economy. Let's hope they don't build a freaking Lowe's or Wal-Mart there if they decide to knock it down!
Posted by opns on July 24, 2008 at 3:46 p.m. (Suggest removal)
I agree, if the company stays in the US - Great!
But outsourcing to china and EU is because of cheap labor and going green. to name a few
Posted by creggsteffler on July 25, 2008 at 6:42 p.m. (Suggest removal)
ebrockway - well said!
But, sadly, stating basic rational facts of life just doesn't cut it with lefties these days.
They operate purely on emotion. No thought involved; they just repeat the knee-jerk reactions that they have been taught.
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