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Barnes Group Inc., Bristol, CT, an international aerospace and industrial components manufacturer and logistical services company, reported several actions undertaken in 2008 to address deteriorating economic conditions and improve performance of its global business segments.
During the fourth quarter of 2008 our entire organization continued to proactively anticipate and adapt to the unprecedented changes affecting all of our businesses as a result of the tumultuous economy, said Gregory F. Milzcik, president and CEO. "Given the deceleration in global demand for our products and services we took numerous actions to improve our overall cost structure, enhance our manufacturing footprint, and strengthen our global operations.
A freeze on all salary levels for all salaried employees has been implemented, and workforce reductions taken throughout the year continue to reduce Barnes Group's total workforce. As of Dec. 31, 2008 the total number of employees at Barnes Group was approximately 5,700, a reduction of about 800 employees from year-end 2007
Barnes realigned its three-group reporting structure into two global business segments (Precision Components, and Logistics and Manufacturing Services) by aligning its strategic business units with a focus on core functional and delivery capabilities. Aligning the segments for growth and efficiency reduces administrative costs and strengthens focus on the needs of customers.
Precision Components implemented discrete workforce reductions and product rationalization activities throughout the business. These include vacating the Central Lake, MI, facility when its lease expires in September 2009 and idling the Monterrey, Mexico, facility, both of which primarily support the transportation industry. The work from these facilities is being transferred to other locations.
The business disruption related to the strike at the Boeing Company totaled approximately $25 million in revenue lost during the quarter. Workforce reductions and cost containment actions were taken to position the aerospace OEM business to emerge a stronger, leaner and more efficient producer of complex components and assemblies.
Logistics and Manufacturing Services
The Logistics and Manufacturing Services segment in North America and Europe implemented the previously announced exiting of certain non-core activities within United Kingdom (U.K.) operations, closure of the Atlanta distribution center by the end of the first quarter of 2009, and other cost reduction activities.
In another action, the North American Integrated Supply activity within Logistics and Manufacturing Services has been sold. Terms of the transaction were not disclosed.