Posted on 04/24/2007 8:21:11 AM PDT by Wolfie
Hershey to Close Reading, Pa., Plant
The Hershey Co., the nation's leading candy maker, said Monday that it will shut down a plant in Reading as part of a wider move to cut labor and materials costs.
The closing, which will affect about 260 unionized employees, is the company's second plant-closing announcement in a little over two months.
"Our network operates at less than half of capacity (over seven days) and we must make significant changes to remain competitive," Hershey (nyse: HSY - news - people ) spokesman Kirk Saville said.
Saville said the company would work out severance agreements with the workers and close the plant in 2008. Hershey is looking to shift more manufacturing to India, China, Mexico and contractors in the United States, and has already announced it will cut up to 900 of the 3,000 workers from three plants in its hometown.
Hershey originally purchased the Reading plant from the Dietrich Corp. in 1987 and brought aboard the Luden's cough drop brand and the Fifth Avenue chocolate bar.
The plant also makes York Peppermint Patties, Reese's crispy crunch bars and Jolly Ranchers. The plant is about 40 miles east of the company headquarters in the town named for the chocolate magnate, Milton S. Hershey.
Maybe we can buy Chinese corn for bio-fuel and use our own corn for food?
Yah...send it to China, so we can have melamine in our Hershey bars.
Crazy Ross was a prophet!
Same on Wall Street, they are all moving thousands of jobs to India. I know this firsthand. I wish I could tell you some of the garbage that I have seen and heard.
Bye, Hershey. Not the town, the company. Go f yourselves.
I believe you. Some on this site reject Thomas Friedman's analysis in "The World is Flat." I think he gets it. I think it will be really interesting when the first corporate board discovers that they can get a first rate Asian CEO for a lot less than our current corporate raiders...
We need to rediscover and apply basic economics. As Thomas Sowell points out, at the fundamental level it is about allocation of scarce resources among multiple opportunities. We need to look at our collective scarce resources and allocate them where we get a return on investment. When I was growing up, kids who were disruptive in academic classes were sent to work with the janitor or to vo-tech classes. They learned to do something productive and were not permitted to hold the rest of the class back. Now we give them aides and tutors and too frequently still get marginal performance.
You are right. It reminds me of the poster:
When they came for the Jews, I said nothing because I wasn't one; when they came for the gypsies, I said nothing because I wasn't one; when they came for the homosexuals, I said nothing because I wasn't one; when they came for me, there was nobody left to say anything...
This is tragic!
India!
China!?
Excuse me, China poisoning Pet Food wasn’t enough, now I’ve got to worry about my chocolate!?
Good grief!
I have a better one, after all the cost cutting has been shipped off and all the low hanging fruit (hate that one) has been picked by these 30 million a year CEO's and the upper management, what will they do? RETIRE!! and leave the mess for someone else!
I have seen this many times. The Grey haired corner office guys take the fastest way possible to show results. They need to do this as fast as possible. Outsourcing is the latest trend (15 years). When some skill and creative process is needed along with risk, they bolt.
“Are they relocating production to New Orleans?”
OMGosh. That was a good one!
ALL of our jobs are threatened. They always are and always have been in a free market. That is the point. America has been shielded from this by several artificial constructs for some years. Those constructs are falling away, and people are scared and begging for government to come in and rig the markets, rather than allow us to compete (which we have done quite well, historically). The amazing thing about it is that on Free Republic, arguably the most conservative venue for opinion on the net, people are responding like a bunch of socialists. We have turned into an nation of crybabies. This always happen when nationalism trumps freedom. The safest way to continue to LOVE America is to threaten to leave it if it renounces freedom.
There are probably savings in the labor but candy production is highly automated. Regardless labor is not the reason candy makers are moving to Canada, Mexico, etc.
The real issue is sugar cost. The US sugar price is about 20 percent higher than the “world” market due to protectionist agricultural programs. The sugar cost is a very big deal in this industry.
Better keep an eye on the law that says they have to tell you where it's made.
There should be no expectation for job security. Labor is a contract between one man (employer) and another (employee) and either side should be free to terminate at any point.
Very well said. What is really interesting is that the protectionist subsidies are the root cause of this issue. As you mentioned, the argument is that we can’t compete against there workers who toil for dollars a day. The result is artificially high prices and then companies moving to where they can get lower prices for products they need.
The irony is that now others want to put more artificial barriers in place to prevent companies from leaving. They are trying to “solve” the problem, if it is even a problem, by enacting the same types of barriers that caused the problem in the first place.
As I pointed out on another thread, this argument boils down to "people who think that labor should move freely (and legally) in its own market think that their own labor will not." It would require an astounding level of cognitive dissonance.
I think it was Jonah Goldberg who observed that people who don’t have the intellectual firepower to defend themselves resort to questioning the motives of their opponents.
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