Beleaguered Corning Inc. has laid off a quarter of its staff at its Garden Grove and Cypress facilities as part of a larger companywide bid to deal with a dramatic slowdown in business.
In all, 75 Orange County employees of the Corning, N.Y.-based maker of fiber optic cables and components lost their jobs, bringing the company’s local roster to about 220.
The layoffs were part of wider cost-cutting in Corning’s networking components business, which has facilities in Rochester, N.Y., Boston, Cypress and Garden Grove.
Orange County was hit hard in a first round of cuts, while other locations were hit worse in the second round. Both took place during the summer.
“This has been an issue across the telecom industry,” said Corning’s Garden Grove plant manager Kevin McCarthy. “We’re definitely in a slowdown. The whole sector is struggling.”
But even as Corning cuts its OC staff, it’s putting the finishing touches on a new building in Fountain Valley, set to bring the Cypress and Garden Grove operations under one roof. The company started work on the building last year and plans to complete it on schedule this month.
At 120,000 square feet, the Fountain Valley building is set to house production, research and development and executive offices. It is designed to make a special regulating product that controls wavelengths of light in fiber cable.
Also, Corning executives said they are eyeing the real estate around the new building. The new building sits on a 7-acre parcel, but Corning has worked out a deal to acquire the adjacent 7- and 6-acre parcels. The company eventually could employ 2,400 people in OC, company officials say. But those projections are the most optimistic and predate the telecommunications downturn.
The OC job cuts come as Corning is trimming everywhere. The company has closed plants in New York and North Wales and closed several other manufacturing businesses. By the end of the year, Corning expects to have laid off 12,000 people.
After years of heady growth, Corning has had to cut back on short-term plans as telecommunications customers order fewer parts. The company’s OC operation was a shining star in the company’s plans until a slowdown in networking gear hit.
For now, shipments are up at the OC division, according McCarthy. In the third quarter, the local operation doubled the amount of units shipped vs. the same quarter last year.
“It’s just that when you compare it to 1,000% (growth) last year, it looks bad,” said McCarthy, who expects growth rates out of his plant to pick up somewhat by the end of 2002.
Wall Street has continued to sour on Corning’s shares, which have been sacked along with other networking gear makers such as Cisco System Inc. and Nortel Networks Corp. Corning traded as high as 113 a year ago but went on a year-long slide to 8 at recent check. n
