June 2, 2016
The OEM’s supplies distribution centre in Webster, New York will be closed as part of the OEM’s restructuring.
Democrat and Chronicle reported on the closure of the centre in Webster “as part of restructuring efforts” amid the OEM’s forthcoming split into two companies. The news site noted that 48 jobs will be lost as part of the closure and another round of cuts in California, with Xerox said to have “struggled with declining revenues for several quarters now”, while CEO Ursula Burns recently confirmed she would not remain as CEO after it splits.
The OEM plans to split into two separate businesses, one focused on services and the other focused on hardware in a strategy similar to the recent split of HP into Hewlett Packard Enterprise and HP Inc. The so-called Document Technology company would be worth $11 billion (€1o.1 billion), while the business process outsourcing company would be worth $7 billion (€6.4 billion).
Xerox expects the separation to “be complete by the end of 2016”, and for it to “maximise return to shareholders and align with current market dynamics”. A “strategic transformation programme” will also take place for three years in both companies, with Xerox noting that it has planned “as much as” $700 million (€624 million) in savings this year, and $2.4 billion (€2.1 billion) “over three years” after the split. As a consequence, its first quarter results were poor, with expectations missed and revenues falling.
39 jobs are set to be lost at the OEM’s site in Cerritos, California, near Los Angeles, while “most of the jobs in Webster are union jobs, six area-salaried positions”, with the workers’ last day 29 August. Around 4,600 people are employed by Xerox in Rochester and the surrounding area, and the OEM plans to “partner with a third-party provider” to manage its operations there.
Xerox also told local US Senator Chuck Schumer that its split “would not have a major impact on the local workforce”, and that its document business would be “committed to Rochester”, with Schumer’s spokesman Jason Kaplan responding that the cuts were “concerning”, and that “we are very disappointed and displeased and we will be conveying that message directly to Xerox”.
Bill McKee, Xerox’ spokesman, commented in turn: “These restructuring activities affect all parts of the company, including warehouse operations in Webster and California. Business today requires greater flexibility and the need to remain competitive. We continually review our operations to find those ways.”
Previous job cuts have been reported in the last few years, including: 98 in Seattle, 84 in Louisiana, 495 in California and 178 in North Carolina this year; 123 in New York and 468 in Texas in 2014; 25 in Virginia, 48 in Canada, 439 in Texas and 300 in Oregon in 2013; and 2,500 across the company in 2012. Recently however, it also announced it was hiring 545 people in California, and recalled laid-off employees in Colorado.
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