PERU - Schneider Electric announced Friday it is closing its Square D facility in Peru and moving all production to facilities outside the state.
The company, which is one of the largest employers in Miami County, currently employs 306 workers at its plant at 252 N. Tippecanoe St., according to a company spokesperson.
The company said in a release it plans to transfer all production to its Schneider Electric’s facility in Texas, and one other East Coast plant yet to be determined. Some production will also be shifted to the company's plant in Monterrey, Mexico.
The transfer will result in the closure and sale of the Peru facility, which manufactures switchgear and switchboard apparatus. All transitions are expected to be completed by the end of the 2019.
The company said the closure is in "response to competitive market dynamics and to meet the needs of Schneider Electric’s customers."
Employees at the facility are represented by Local 2069 of the International Association of Machinists and Aerospace Workers (IAMAW).
Tim Reimke, a spokesperson for Indiana's IAMAW branch, said in a phone interview Saturday that union officials were "blindsided" by Friday's announcement, and company officials haven't told him why they are closing the Peru plant.
"Ultimately, I think it comes down to corporate profits and corporate greed," he said.
Reimke said union leaders are set to meet with company officials next week to lay the groundwork for collective bargaining and also try to convince the company to keep the Peru plant open.
"We're going to muscle through this and see what we can do, if anything," he said. "We're going to try to keep people working."
In 2014, employees went on a two-week strike during contract bargaining between the company and the union, which claimed the company didn’t offer high enough pay raises for entry-level employees. The initial offer also froze pension benefits.
The strike ended after the union officials said they felt they won improvements in key areas in the new three-year contract.
In addition to a signing bonus of $1,600, the deal also included a general wage increase of 3-percent in the first year, and then a 2-percent increase in both the second and third years.
Since then, the company has implemented major layoffs at the plant.
The company first announced its plans for layoffs in 2016, when it said it would move some of its production lines to its facilities in Texas and South Carolina “to enhance the company’s competitive position to meet the needs of its customers.”
In 2017, around 70 workers were terminated, followed by 61 more employees in 2018. The layoffs marked a 25-percent reduction in the workforce at the Peru plant.
Peru Mayor Gabe Greer said the closure of the Square D facility will have a "huge impact" on the city.
"My father, my uncles and grandmother-in-law all worked at the Peru Square D for years, and most people in town know at least one person who works there," he said. "Unfortunately, it seems that Schneider Electric had made up its mind to leave four years ago after negotiations with employees."
But, Greer said, there is one silver lining to the situation - other factories in town are hiring, such as Progress Rail, Snavely Machine and Heraeus Electro-nite.
Friday's announcement comes on the heels of other high-profile closures in Peru, including the Kmart, which is set to permanently close in March. The store isn't a large employer, but provided one of the largest shopping options in the city.
Shopper Value Foods, which was one of the major grocery store options in the city, also permanently closed last month.