East Sonora manufacturing plant will relocate to North Carolina
The Sandvik Group will close its East Sonora manufacturing plant by the end of September 2022 and move operations to a facility it acquired this year in Concord, North Carolina, the company announced to employees and the public on Wednesday.
The Swedish company currently employs 45 people at its Sandvik Thermal Process facility at 19500 Nugget Boulevard, where it manufactures industrial heat processing equipment and replacement parts that are used in the production of solar cells, semiconductor devices, and other industrial heat treating.
Aaron Roy, business unit manager for a part of Sandvik known as Kanthal Heating, said about 10 to 15 of the employees will be offered positions in North Carolina, while the company will provide severance packages for the rest and work with the Tuolumne County Innovation and Business Assistance Department to find them job placements.
Roy said the decision was purely structural and part of a larger effort to reduce redundancies through consolidation after acquiring several other businesses throughout the United States in recent years, including Thermaltek Inc. in Concord, North Carolina.
“We acquired a facility in North Carolina at the end of last year and we’re in a situation where we have to roll up the operations for cost efficiency,” he said. “It’s about the same size but does a lot of similar stuff, so this gives us the ability to utilize the footprint in a better way.”
The announcement comes on the heels of some other major companies in the technology sector recently announcing they will be moving their operations from California to Texas, including Tesla, Oracle and Hewlett Packard, though Roy said there were “no politics involved” in Sandvik’s decision.
Roy said the plans for moving to North Carolina in 18 months were announced to employees in a meeting at 9 a.m. Wednesday.
“I would say the reaction has been overall favorable,” he said. “I don’t think anybody likes that they’ve lost their job, but they understand.”
The plant was built in 1995 by MRL Industries, which was founded in 1979 and initially leased space in Soulsbyville after moving to Tuolumne County from the Bay Area in the mid-1980s.
MRL Industries originally purchased raw materials from Sandvik before the company acquired it in 1999 because they wanted to expand their business portfolio, Roy said.
“They wanted to forward integrate, and that’s what attracted them to acquire this business,” he said.
Roy said the number of people employed at the plant has fluctuated over the years due to factors that include cycles in the semiconductor industry, automation, and businesses that would previously purchase from them moving offshore.
Positions currently employed at the facility range from engineers to front office staff.
“These are not minimum wage jobs,” Roy said.
Employees who will be offered new jobs in North Carolina if they’re willing to move are mainly on the manufacturing side and have what Roy described as unique skill sets that would be more advantageous for them to move over rather than train new employees.
Roy said the company plans to have operations shut down by June 2022 before completing the move by the end of September 2022 and will be working with Cole Przybyla, director of the county’s Innovation and
Business Assistance Department, in the meantime on the transition for employees who don’t relocate.
Przybyla said he and others at the county had been in discussions with the company to make the case for staying in the county before being notified about the final decision to move this past week.
“Our priority now will be to help facilitate the transition of the building and ensure that those employees who want to remain in Tuolumne County get the assistance they need for job placements,” he said.
One of the ways Przybyla plans to assist employees is with the help of the Mother Lode Job Training center in Sonora, which offers a layoff aversion program and employee training resources.
Przybyla said he feels confident with the expertise and assistance of Mother Lode Job Training that they will be able to find employment for all of the affected employees before the plant shuts down. He also has some ideas for the roughly 100,000-square-foot facility that’s zoned for light industrial manufacturing.
“I have already reached out to key partners and site selectors and my contacts, and I see this as a huge opportunity for one of those companies,” he said.
There is $17 million available in a biomass utilization fund through the Sierra Nevada Conservancy that comes from
the National Disaster Resilience Competition grant for projects to help
the county recover from the 2013 Rim Fire and better withstand future disasters.
The money is specifically from a part of the grant earmarked for the development of a biomass facility that would produce energy and wood products from material taken from the forest to help reduce the risk of wildfire
and restore areas burned by the Rim Fire.
“We have had a lot of interest from natural resources manufacturing companies, so to find the right fit is the key, and this might be a really great opportunity,” he said. “While I loved having Sandvik as a partner in the community, I see this as an opportunity to expand on the priorities we outlined in February in attracting natural resources manufacturing companies and other groups.”