MALVERN, PA — Vishay Intertechnology, Inc. (NYSE: VSH) has announced a series of restructuring measures designed to optimize its manufacturing operations and streamline decision-making processes as part of its Vishay 3.0 growth strategy. These changes aim to enhance the company’s focus on cost efficiency and customer service.
The restructuring will occur in phases and include significant workforce adjustments. Approximately 170 employees in selling, general, and administrative roles, representing 6% of that workforce segment, will receive severance payments as these functions are streamlined by the end of 2025.
In addition, Vishay plans to close three manufacturing facilities. This includes a Diodes segment facility in Shanghai, China, and two smaller facilities in Fichtelberg, Germany, and Milwaukee, Wisconsin, by 2026. These closures will affect about 365 employees, reducing the company’s manufacturing workforce by 2%. Additionally, operational changes will lead to severance for about 260 more employees.
The company anticipates pre-tax cash charges of $38 to $42 million, mainly related to these severance costs, with significant expenses expected in the third quarter of 2024. Once fully implemented by 2026, the restructuring is projected to save at least $23 million annually, with immediate savings of around $9 million and further savings reaching $12 million annually by early 2025.
“As we implement Vishay 3.0, reshaping the Company and preparing for our next phase of growth, we continuously task ourselves with identifying opportunities to best foster a business-minded approach to decision-making, further enhance our customer-first focus and improve cost efficiencies,” said Joel Smejkal, President and CEO of Vishay. He added that these actions are part of optimizing the global manufacturing footprint and moving towards more efficient campus structures.
Vishay’s cost reduction estimates and expected savings are preliminary and may change as the restructuring progresses.
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