BERN TWP., Pa. — EnerSys' board of directors has approved a plan to close its facility in Ooltewah, Tennessee, which focused on manufacturing flooded motive power batteries for forklifts.
EnerSys, based in Bern Township, announced the restructuring plan Wednesday.
In connection with the plan, which is estimated to be substantially complete in calendar 2023, EnerSys plans to sell the land and buildings and possibly the plant and equipment to other parties.
EnerSys said it expects to cut 165 employees through the plan.
EnerSys said management determined that future demand for traditional motive power flooded cells will decrease as customers transition to maintenance-free batteries using lithium and thin plate pure lead.
The company said that as a result of the closure, it expects to eliminate nearly $8 million of costs per year. Production of products being manufactured in Ooltewah, Tennessee, will be moved to other EnerSys facilities in North America.
EnerSys expects to incur an $18.5 million pre-tax charge under the restructuring plan when it's completed, the majority of which is expected to be recorded in the first half of fiscal 2023.
Of that, $9.3 million is expected to be a non-cash charge from asset and inventory write-offs. Cash charges of $9.2 million include key employee retention, clean up and equipment decommissioning, along with contractual releases and legal expenses.
