Electrolux, the Swedish appliance maker, is injecting $ 500 million into its U.S. plant to upgrade and expand its manufacturing operations in the United States, while supporting the production of its new kitchen appliance by the Frigidaire brand.
Under the investment plan, Electrolux will spend more than 250 million US dollars for its Springfield, Tenn. Mill plant upgrades and expansion, the transformation is completed, the plant will be modernized, the plant will expand by 400,000 square feet to enhance production capacity The plant will be retrofitted in the second half of this year and plant upgrades and expansion will be completed by 2020.
Electrolux said the Springfield plant will also produce new kitchen appliances.
The remaining $ 250 million was planned for the Electrolux refrigerator / freezer plant in Anderson, South Carolina, which produced Frigidaire branded products that began modernization and plant expansion last year and is expected to complete the factory transformation in 2019.
Electrolux will also move freezer production from the Santa Claude plant in Minnesota to the Anderson plant as part of the revamping plan while the St. Cloud plant will be discontinued by 2019. Electrolux will begin offering 7500 in the first quarter The reorganization fee of US $ 10,000 is to realize the integration of the two factories.
'This is a tough statement for our teammates in Minnesota,' said Alan Shaw, head of Electrolux North American Inc. 'We are committed to supporting them and making a statement two years in advance to provide transitional time.'
Alan Shaw further said that Electrolux 'is committed to the Frigidaire brand and our North American manufacturing base,' and that the merger will help streamline business operations.
Electrolux said the $ 500 million investment plan is part of its plan to drive capital expenditures to grow in North and South America within the next three to four years with investments focused on product development, automation and innovation.
Electrolux Introduced the New Frigidaire Product Line at the Kitchen & Bath Show in January, Including Freestanding Frigidaire Pro Refrigerator with Stainless Steel Panels and Glass Windows Featuring Extra Glass Window and LED Lighting, Electrolux Freezes Open Refrigerator Door You can see the ingredients in the refrigerator.
In addition, Electrolux also released fourth quarter and full year 2017 results due to adverse exchange rate fluctuations, Electrolux fourth quarter net sales of 323 billion Swedish kronor, up slightly by only 0.7%; operating profit 1.6 billion Swedish kronor, up 22%.
Electrolux achieved net sales of 122 billion Swedish kronor for the full year 2017, an increase of 0.8% over the same period of last year; operating profit increased 18% to SEK 7.4 billion.
In North America, Electrolux posted fourth-quarter sales of 9.6 billion Swedish kronor, down 4.2 percentage points due to lower sales of its own-brand products and pressure on prices in the market. Due to price promotions, raw material price increases and new product release costs, Iraq Lex in the fourth quarter operating profit of 477 million Swedish kronor, a substantial decline of 27%.
Last year, Electrolux sold sales of SEK40.7 billion in North America, down 6.3 percentage points over the same period of last year; cost efficiency increased and the expansion of high-end product portfolio achieved an operating profit of SEK 2.8 billion, an increase of 3.2%.
Electrolux President and CEO Jonas Samuelson said Electrolux has achieved an operating profit target of 6.1% last year, which rose nearly 20%. Looking to the future, he expects the North American market to grow at a rate of 2% -3% in 2018, At the same time, he also said Electrolux will implement the previously announced product price increases and investment in North American kitchen appliances.
Electrolux declined to comment on the effects of U.S. President Trump's announcement of protective tariffs on imported washing machines and components.