Tenneco Inc. announced plans to discontinue and liquidate Marzocchi, an Italian company that makes suspension forks for motor and mountain bikes.
The company must consult with employee representatives before proceeding with the plan, which would eliminate approximately 138 jobs. Tenneco currently employs 127 people at the Marzocchi plant in Bologna, Italy and an additional 11 people in its operations in North America and Taiwan.
Tenneco intends to assist its motor bike customers with the transition of current production to an alternative supplier and expects to complete the closure by the end of 2015.
“We sincerely regret the impact these actions would have on our Tenneco Marzocchi employees and thank them for their tireless efforts to improve performance and reduce costs. Unfortunately, it was not enough to overcome continuing market challenges in the two-wheeler business,” said Brian Kesseler, COO, Tenneco. “We are committed to working with our employees’ representatives, and with our customers, to make the transition as smooth as possible.”
This intended action is part of Tenneco’s ongoing efforts to optimize its Ride Performance business globally, while continuously improving its operations and increasing profitability.
Tenneco expects to record charges of approximately $27 million related to these actions in the third quarter which include approximately $17 million of cash expenditures. These charges consist of severance and other employee related costs, asset impairment charges and other expenses related to the closure. The company anticipates improving financial results by approximately $7 million annually, beginning in 2016.
Tenneco is an $8.4 billion global manufacturing company with headquarters in Lake Forest, IL and approximately 29,000 employees worldwide. It is one of the world’s largest designers, manufacturers and marketers of clean air and ride performance products and systems for automotive, commercial truck, off-highway original equipment markets and the aftermarket. Tenneco’s principal brand names are Monroe, Walker, XNOx and Clevite Elastomer.
