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DOUBLE WHAMMY: IVC LAYS OFF 100
SoVaNow.com / January 16, 2013International Veneer Company (IVC) announced Monday it will lay off about 100 employees as it winds down the production of hardwood veneers at its South Hill plant over the next 60 days.
The company will continue to employ approximately 25 employees in town to handle veneer grading, warehousing, sales and administrative functions.
The manufacturing of wood veneers, used in construction and furniture products, will be shifted to a company mill in the Mercer, Pennsylvania area, IVC said.
IVC President Tyler Howerton called the layoffs “extremely painful and disappointing news to everyone at IVC, especially our dedicated and loyal employees. Our employees are caring and professional and our heart goes out to them.”
The announcement also comes as a blow to the local economy, already hard-hit by the loss of Home Care Industries, which closed earlier this month at the Airport Industrial Park in La Crosse. That plant shutdown also cost about 100 jobs.
Howerton, a South Hill resident, laid the IVC shutdown to “an overcapacity of veneer production facilities” and “unfortunately, the South Hill plant is too far from our sources of raw material [hardwood]. Therefore further veneer production will be shifted to our sister mill in Pennsylvania.” The statements were contained in a letter to the state’s displaced worker unit.
IVC is pledging to work “very closely” with the Virginia Employment Commission to assist affected employees. The letter did not explicitly offer South Hill plant workers an opportunity to transfer to IVC’s Pennsylvania facility, but “we are exploring that possibility,” said Howerton in an interview Tuesday.
IVC was ordered to pay heavy fines and penalties last year after being convicted of a single federal charge of shipping products to Syria, which is under a strict U.S. embargo, but Howerton said the outcome of the case has nothing to do with the South Hill plant downsizing.
Instead, IVC is bowing to trends in the marketplace that have prompted rival companies to take similar steps, he said.
“This is a shrinking industry and it simply costs more to get the logs here than to our mill in Pennsylvania. Most of our competitors have taken that step in the last three to four years,” said Howerton. “We were looking at all our alternatives before we made the decision to close.”
International Veneer began operations in South Hill in 1987 and has long reigned as one of the town’s mainstay industries. As recently as 2003, the company underwent a $2 million expansion of equipment and facilities, although the move did not change the overall level of employment at the plant, according to the Virginia Economic Development Partnership. IVC also weathered fire at its facilities as it continued operations in town.
In 1997, the company established an additional mill in Mercer, Pennsylvania. IVC bills itself as an international company operating in the global marketplace, with facilities in Virginia, Pennsylvania, Indiana, Canada, Italy and Germany.
IVC has struggled with legal issues over the past several years, with the company coming under federal investigation for exporting products made out of protected materials and for doing business with nations subject to U.S. trade restrictions. Less than a year ago, IVC admitted to smuggling $2.6 million in wood veneer sheets and forklifts into Syria over a four-year period from 2007 to 2011.
Trade between the United States and Syria has been embargoed since May 2004. Under a plea agreement with federal prosecutors entered into the court record in March 2012, IVC paid a fine of $50,000 and forfeited an additional $2 million in profits from the transactions.
In 2010, IVC was accused by the Department of Homeland Security of importing endangered wood — afromosia — from the Congo. The shipment came from one of IVC’s affiliated sites, R. Ulrich & Co., in Hamburg Germany. At the time, Howerton dismissed the complaint as “a misunderstanding” that was being worked out.
The wood, which is a teak substitute, is harvested from the Congo Basin rainforest, the second largest rain forest in the world. Its import is covered by the United States’ Endangered Species Act.
More recently, in December 2012, the company paid a $12,600 fine for engaging in transactions involving the sale of goods to Lebanon and the United Arab Emirates while trade with the countries was restricted. The payment came after the Bureau of Industry and Security in the Department of Commerce initiated an administrative action against IVC for “Failing to Report The Receipt of A Request to Engage in Restrictive Trade Practice” in violation of federal law.
IVC was ordered to pay the fine before its export license, issued by the Department of Commerce, would be granted or restored. The order fixing the fine was signed on December 19, 2012.
The layoffs at IVC and Home Care Industries come two months after Mecklenburg County posted its lowest unemployment rate — 8.9 percent — in more than four years. The November rate, reported by the Virginia Employment Commission earlier this month, is the latest jobless figure available.
CommentsHows that hope and change working out for you now?
- By email@example.com on 01 / 17 / 13
CommentsThis company was slimy from the start. The "family friendly" meant they were friendly to their family, the owners...... good riddens.
- By Rmoore on 05 / 10 / 13
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