HANOVER TWP. — Citing a slowdown in orders, Air Products & Chemicals Inc. announced Wednesday its plant is shutting down as of Aug. 1, leaving 75 employees out of work.
According to Art George, communications and public relations manager at the Hanover Township facility, discussions were held Wednesday morning with employees to discuss the state of business.
“We informed our employees that orders have slowed down dramatically over the last year-and-a-half,” George said. “Add to that the fact that we do not foresee an uptick in new orders coming anytime soon.”
George said all 75 workers will receive a severance package.
“We have done the best we can to keep the facility operating by adjusting the size of the workforce and salaries,” George said. “We wish we had more orders.”
George said the liquefied natural gas heat exchangers the plant builds — measuring two-thirds of a football field — take two years to manufacture. He said the jobs being cut are very specialized, mostly welders and other support staff.
Air Products purchased the Hanover Township site in 1954, George said, and operations began in 1955. He said more than 200 people were employed at the plant from time to time.
George said due to the current oversupply of natural gas in the market, there is simply no need for the equipment manufactured at Air Products.
“Hopefully, sometime down the road that will change,” George said.
As far as the building in Hanover Township, George said he did not know what the company’s plans were and would not comment.
Air Products also manufactures heat exchangers near Port Manatee, Fla. George said the Florida facility has room for future expansion if determined necessary.
Based in Trexlertown, Air Products is a Fortune 500 company with about 16,000 employees worldwide, including approximately 2,300 in the Lehigh Valley. It had fiscal 2015 sales of $9.9 billion and has a current market capitalization of more than $30 billion, according to its website.
In November, the company announced further layoffs were expected at the plant in Hanover Township. The company laid off 26 in September.
The local plant has made the heat exchangers for more than 45 years, and its workers are represented by the International Association of Machinists and Aerospace Workers Local 2200.
Rail transport an issue
George said the heat exchangers built at the plant would have to be transported by rail to the Port of Philadelphia — a five-day trip. George said it was no longer feasible to continue sending the exchangers via the rail line in Wilkes-Barre.
Air Products has been a longtime customer of the Luzerne County Redevelopment Authority’s rail line, authority Executive Director Andrew Reilly said Wednesday.
“Obviously, we’re very concerned about losing a good employer in our area,” Reilly said.
He did not have specifics on the authority rail revenue that will be lost, but said it won’t be a major blow because Air Products typically transported only two heat exchangers on the line annually.
“The rail operator will try to make up that business somewhere else,” Reilly said.
Yudichak issues statement
State Sen. John T. Yudichak, D-Plymouth Township, issued a statement regarding the Air Products layoffs:
“I am deeply saddened to learn Air Products will be closing its Hanover Township facility and cutting local jobs. For more than five decades, the men and women of the International Association of Machinist and Aerospace Workers Local 2200 put their hearts and souls into building the best liquefied natural gas heat exchangers in the world, which built Air Products into a world-class brand.
“Air Products has long been a bedrock of quality manufacturing jobs in the Wyoming Valley, but the decline of global demand for LNG equipment and the opening of an Air Products plant in Florida, in 2014, ultimately proved to be too much for the local facility to overcome.
“Our office will work with Air Products and all the appropriate state agencies to help displaced workers transition to new employment and educational opportunities.”
Reach Bill O’Boyle at 570-991-6118 or on Twitter @TLBillOBoyle.