Press Release
For Imediate Release
March 18th, 2009
WEG announces the restructuring of manufacturing
plants of electric motors for appliances
Jaraguá do Sul, March 18th, 2009 - WEG S.A. (Bovespa: WEGE3) announced today a
restructuring plan for its area of electric motors for appliances. With the objective of
achieving greater productivity and competitiveness in this segment and in view of the
current economic situation and consequent reduction of consumption, WEG decided,
after detailed analysis, to increase the centralization of production and end productive
activities in the Guarulhos (SP) plant, one of 3 plants manufacturing motors for
appliances operated by WEG in Brazil. The end of manufacturing activities in Guarulhos
will cause the dismissal of 370 employees, most of which are already in paid leave, a
fact already reported to the workers’ Union.
Among the products manufactured at the Guarulhos plant, the motors for air
conditioners have faced the stronger retraction in demand as a result of changes in
reference industrial policy in the Zona Franca de Manaus (an incentivized imports
processing zone). Up until the middle of 2007 industrial policy was oriented towards the
integration of the production chain, encouraging the use of nationally produced
components. The amendments were made to the regulation, which started to accept
industrial activity based on CKD (disassembled kits), which allows importing
components with preferred tax treatment, allowing the substitution of Brazilian produced
components. Despite the temporary nature of the changes initially, they have been
renewed.
"The end of activities in Guarulhos is a difficult decision but necessary in the present
context," said the director-president of WEG, Mr. Harry Schmelzer Junior.
Mr. Schmelzer added that "Although revenue growth in first quarter is still close to our
initial expectation, mainly as a result of performance in projects of large electrical
machines for the energy sector already in progress, the visibility of market conditions for
the next quarters has not improved in relation to the end of 2008. Thus, we are adopting
measures to address this scenario in better economic conditions." The actions include a
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Press Release
For Imediate Release
March 18th, 2009
review of activities in production and administrative areas, with focus on controlling
costs and expenses, the temporary suspension of new hires and possible negotiations
for adoption of alternative measures to address reduction of production in areas that are
most affected by the market decline.
For further information, please contact
Investor Relations
Corporate Communications
Luis Fernando Oliveira
+55 (47) 3276-6973
luisfernando@weg.net
Caio Mandolesi
+55 (47) 3276-4295
caio@weg.net
###
About WEG – Founded in 1961, WEG operates mainly on the capital goods segment
and is one of the world’s largest manufacturer of electro-electronic equipment,
producing electric motors, generators, transformers and protection, command and
control electric and electromechanical components.
In Brazil WEG is headquartered and has its main manufacturing units in Jaraguá do Sul,
state of Santa Catarina. In the same state are located several other production sites, in
Blumenau, Guaramirim e Joaçaba. Other plants in Brazil are located in the states of Rio
Grande do Sul (Gravataí), São Paulo (São Bernardo do Campo e Hortolândia) and
Amazonas (Manaus). Outside Brazil WEG has manufacturing units in Argentina,
Mexico, Portugal and China and distribution & commercialization units in the USA,
Venezuela, Colombia, Chile, Germany, England, Belgium, France, Spain, Italy,
Sweden, Australia, Japan, Singapore, India, Russia and UAE.
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