MILWAUKEE — A. O. Smith Corp. announced it will discontinue manufacturing at its Renton, Washington, commercial water heater plant, effective June 15.
The 101,000-square-foot plant manufactures commercial gas and electric specialty water heaters, hot water storage tanks, electric boilers, and skid-mounted systems. The facility employs approximately 55 people.The company will transfer production of commercial electric water heaters, storage tanks, and boilers to its McBee, South Carolina, and Lebanon, Tennessee, plants. Over time, the customer service function will be consolidated into the company’s existing customer care facility in Ashland City, Tennessee.
“Today’s action is part of an ongoing initiative to ensure the competitiveness of our North American operations,” said David R. Warren, president and general manager of North America water heating. “Relocating manufacturing to McBee and Lebanon will create synergies and position that production closer to our commercial engineering resources. Renton is a small plant, making a limited number of units, and the facility does not have the space or flexibility to expand operations. By transferring production to the larger McBee and Lebanon facilities, we will be able to leverage economies of scale and take advantage of their higher degrees of automation.
In addition, rental costs for the Renton location have been increasing significantly. We do not face that issue in McBee and Lebanon, both of which are owned by A. O. Smith.
“This was a difficult decision to make, given A. O. Smith’s 40-plus year history in the Seattle area and our experienced team in Renton,” Warren continued. “We acknowledge this will cause uncertainty for our Renton employees, and we are committed to providing them assistance.”
The company met with affected employees to discuss details regarding the production transfer. Employees will be offered severance benefits, and the company will fully fund the facility’s two pension plans.
Publication date: 4/9/2018