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ABB lays off 113 in South Boston

South Boston News / January 09, 2020
Citing a global slowdown in demand, ABB laid off 113 of its employees at the South Boston small electrical transformers plant on Wednesday, idling nearly a quarter of the local workforce.

Plant employees were summoned to a meeting with management to receive the news, with the layoffs apparently spread heaviest among the plant’s first and second shifts. Among those impacted by the job losses are employees who have worked for ABB and the predecessor company, Westinghouse, for decades.

“Due to a global slowdown in transformer demand, the ABB Power Grids business is reducing the number of employees at its South Boston, Virginia location,” said Christopher Shigas, ABB director of external communications, United States, in a statement emailed late Wednesday. “Eligible employees will have access to severance benefits, job placement assistance, and may be able to relocate to other ABB locations.

“This business decision is in no way related to the performance of the local team and we are committed to supporting the employees throughout this process. The South Boston facility continues to be important to the ABB Power Grids business,” Shigas stated.

Prior to the layoffs, the South Boston plant employed 467 workers. Persons with direct knowledge of ABB’s local operations said the terminations did not come entirely as a surprise, but they did not expect to hear the bad news so soon.

“Everybody knew it was coming,” said one source who asked not to be identified.

The announcement caught local officials by surprise. Halifax County Industrial Development Authority Executive Director Brian Brown, who began work in September pledging to strengthen IDA partnerships with local industries, said Wednesday afternoon that he was seeking more information about the plant layoff.

“I’ve heard about it, but I don’t know the extent of it,” Brown said.

Landon Rock Mason with SVCC Workforce Development also said Wednesday that he had only learned about the layoffs that day, although “I am uncertain about the actual numbers” of idled workers.

“I’d think for PR reasons they’d want to stay ahead of this and help inform the public,” Mason added.

In recorded audio of the meeting taken inside the plant, a member of ABB management can be heard breaking the news to employees. The audio was obtained by this newspaper late Wednesday.

The management official, explaining the decision, said the market downturn for electrical transformers has been in free fall, with orders at the plant cut in half in the May-June period.

“We tried everything we can, however the market was not turning around” to support the level of employment in South Boston, he said.

Prior to the summer of last year, going back at least two years, the South Boston plant had “orders, we had transformers to produce, yet we produced them at a loss,” the management official told employees. Losses since 2017 have been in the millions of dollars, he added.

The audio includes the official offering consoling words to employees: “South Boston stays as a very important facility for ABB Power Grids … We will turn it around and we will be hiring when the market turns with it [but] unfortunately we must do what we have to do today.”

At the meeting, employees were provided information about severance benefits, job assistance and other positions in the company. The management official struck a doleful note near the end of the recorded audio exchange.

“This team here, as I said many times before … is one of the best teams I have ever worked with,” he said.

Calling the layoffs “very unfortunate,” he continued, “Guys, I’m very sorry. I’m very sorry, nobody wanted it to come to this level, but it is what it is.”

In December 2018, Swiss-based ABB announced the $11 billion sale of its Power Grids business to Japanese conglomerate Hitachi, a transaction described in the business press as a move by ABB to simplify its business structure. ABB also indicated at the time that it wanted to focus on digital industries.

Since that announcement, ABB has made other cuts to business divisions, such as a $500 million restructuring announced in January 2019, that impacted corporate office positions. It was not known at press time if the downsizing of the South Boston plant is part of a wider retrenchment of company operations in 2020.

However, Shigas, said the South Boston plant layoffs are not connected to Hitachi’s purchase of the Power Grids unit. “This action is not associated with the joint venture announcement as that deal has not yet closed,” he wrote in an email.

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Great reporting. Folks putting in 8 hours of production during mandatory 10-hour workdays has a lot to do with the downfall. They created that atmosphere by attempting to work longer hours with a smaller workforce. I haven't been inside the plant since the spring of 2015 but I could see this day coming back then. I fear it's not the last of it. Their reassurance of the vitality of this plant should raise suspicions. Increased competition and changing technology is slowly making the South Boston Plant obsolete.


At least we have brilliant leaders with vision and insight giving us a $30 million dollar courthouse project to pay for, a sales tax increase, and a $100 million new school.


Let me get this straight...over 400 local employees knew this layoff was coming. It was expected for weeks. Sources from the local VEC told some employees that they had over 200 packets ready at the request of ABB management, Ryland Clark is part of the ABB management, the Chamber of Commerce, and a member of the IDA board, but still, NO ONE saw this coming, everyone was shocked to hear it. SMDH


In response to your comment David, I think that it is very unfair to include Ryland Clark's name. He is one of the most committed members of this community hence why he is on so many committees. He remains dedicated to the people in this community and utilizes most, if not ALL, of his free time to better the community. Your comment mentions, "sources from the local VCE told someone". This is here say and I think it is unfair to comment on things that are here say and throw his name into just because you may feel a certain way about him. This is unfair and hurtful to others. The lay off is very unfortunate and I pray for the people who lost their way of living, but including Ryland's name in this is wrong just because he may be a member of management. Please think how your comments can affect others based off of here say and not knowing the actual facts.


Just a follow up to David’s comment- I agree with Rebecca. It is uncalled for to throw Ryland Clark’s name into all of this. This young man believes in this county and would never wish any kind of lay-off on anyone. I’ve known this man for years and he is one of the most supportive individuals who actually believes in these county. I’m guessing David you are one of those who always addresses the problems but never has any solutions. It’s real easy to talk the big talk on the internet. Know your facts before you try to single someone out. Roy Stevens- I’m not afraid to use my last name.


Easy one is bashing Mr Clark. You absolutely misunderstood the point of my comment. The article states that local leaders were SHOCKED and no one knew anything about the layoff until Wednesday. They should not have been surprised since so many people, including the 400+ employees, the VEC and a fine, up-standing member of the IDA board. They may not have known an exact total of people or on which day it was coming, but they should have known something.


David, people are always ready to say or start something, but not take the time to completely understand or read what you are saying.


Agree 100 % David. I work at ABB. It was no secret the layoff was coming. No one working there was shocked. They may have been surprised when they found out that they were one of the ones laid off. But we knew it as façt, not rumors, or hearsay. And now you know it's fact, not just hearsay.


Don't mind them David. They're part of the group of geniuses who think now is the right time for a $100 million new school, a $30 million courthouse and a tax increase when 51% of the households in the county have "incomes that were too low to afford the basics including housing, food, transportation and health care"


See they were all smiles.
And a majority of voters agreed with them.


David - He was doing his job and keeping job info silent until the proper time to announce. What if he did announce it tot he chamber and IDA prior and it leaked out? Would you then be crying and whining like a two year old spoiled brat?


I was told about these layoffs 2 months ago. Everyone knew. It wasn't Ryland Clark's responsibility to spread the word. It was his responsibility to stay quite if he wanted a job. Ryland is a good guy I've known for almost 30 years. He has done more for this community in 10 years than most of these career politicians have done in 50 years.


AGAIN.....NO ONE WAS BASHING RYLAND. Everyone knew about the layoff. It wasn't a secret. No local leaders should have been shocked by the announcement. Our tax money goes to the IDA board, yet they don't even knows what's going on with local industries ? If the local VEC was aware, and we @ ABB know they were, then the workforce center should not have been shocked.


I don't not see any comments above where ANYONE was complaining about Ryland or asking him to "out" company secrets. I must be missing something. Although I don't work at ABB, I knew about the up coming layoff for the last few months. I'm pretty sure it wasn't a company secret. I think Dave's point was that it was obvious that local leaders and board members knew or should have known. Ryland knew, as did all other ABB employees, so why would anyone be shocked? I assume Ryland's name was mentioned above since he apparently is in local leadership networks AND an employee of ABB. Some of you seem so quick to come to his defense without any need to defend him.


Ryland is a nice guy, but I agree, nothing said above was derogatory about Ryland. He knew, I knew, everybody knew. It wasn't shocking news. It wasn't a company secret. All the local meetings, all the committees, all the networking, all that Halifax team spirit, and apparently it never came up that ABB was tanking. What the article fails to mention is all the previous meetings where employees were told that if they didn't shape up, the plant wouldn't survive. Its not something that just happened in the last month or so. It didn't start in May-June. The article fails to mention the test failure rates at the plant, the on time delivery rate, the various big energy companies that will no longer buy from our local plant.


"In order to ensure keeping our dividends going and maintaining our strong track record of overcompensating our management to an obscene degree, we are firing your ass. Sorry"

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