Milwaukee Tool will be closing their Clinton, Mississippi facility later this year.
The Clinton facility was only in operation for a short time, and was first announced in 2021.
According to news reports, efforts are being made to move affected employees to Milwaukee Tool’s other Mississippi locations.
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Upon request, Milwaukee Tool provided the following statement:
We’ve recently made the decision to transition operations out of our Clinton facility and relocate these activities to our other facilities, thus improving the overall performance of our supply chain. Despite this difficult decision, we remain confident in our ongoing success and future growth. In the last 5 years we have invested more than $702 million in our U.S. operations, and we have grown our employee population across the country by over 180%. We proudly employ more than 10,000 people in the U.S., and over 4,000 are in Mississippi. The State of Mississippi remains a critical partner for our operations as we continue to deliver innovative solutions to our users and distributor partners.
I asked for additional information, to better understand the context and implications, and was told the following:
We’re going to be making use out of the available space at other facilities when transferring Clinton’s activities.
The close of the plant will take until Q4. Unfortunately, 150 employees are impacted. We’re developing support options for them, as well as working on opportunities for them to move to one of our other locations.
Milwaukee made it very clear that the decision to close the Clinton facility is not a reflection of poor performance, but an effort to maximize efficiency across their domestic operational footprint.
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Hon Cho
I wonder how much in financial incentives TTI (Milwaukee’s parent company) received from Mississippi and if they’re subject to repayment?
Returning manufacturing from overseas or expanding manufacturing in the USA seems to be harder than it appears.
Rob Bag
Why would they pay back. They are staying in Mississippi but consolidation is required. Also making in America is on par with overseas manufacturing as long as unions are keep out
MS. LADY
Well the production lines ( our jobs) are going to China, Mexico and one other country…They make it sound good for the media but they don’t have a lot of jobs positions available at the Jackson plant for the workers unless you’re in the office or an IT…It’s going to affect us (the workers who actually build the tool)…and the plant will be closed long before Grenada open up for production
Chris I
Wait do you work there?
c539932
Also work there, salary (office job) employees are getting cut as well (nearly 80 percent of them), there is not enough jobs in Jackson for any of us. Especially since Jackson is already self sufficient.
Nadiya Purnell
Maybe if they wouldn’t have moved the plant further away from Jackson ms residents they would’ve been more productive 🤷🏽♀️ … exactly why most people complained before moving from the Jackson plant to the Clinton plant. -( a former employee)
fred
I’m sure as tool aficionados we would all like to have been a fly on the wall on the meeting rooms where these decisions (to build and then to close) the Clinton facility were taken. Maybe at some later date in the future this may rise to the level of a business school case study – but I’m guessing that’s unlikely, and we will never know all the ins and outs. Let’s hope that this is just a hiccup and not a harbinger of something worse.
Having been part of a partnership that bought into a failing fabrication business and were able to return it to profitability I can’t even imagine the potential perils of starting up a production from scratch. In our case – we were able to retain most of the skilled workforce (much smaller than the 150 at Clinton) that had a history with the former owners. In Milwaukee’s case starting from scratch in a state known for struggling to improve on low education and poverty rates it must have been incredibly more difficult. They may simply have been overly optimistic along different fronts and are now retrenching a bit as experience has dampened their initial enthusiasm.
Chris
Definitely more to the story. Who’s gonna buy that place 🤔….
Paul Udstrand
I think the same thing has happened to SK tools, and we know Boeing had the same issues with their 737 Max’s in Kansas.
Rand
Forbes calls this going out of business slowly…
Stuart
If you looked at the company’s sales performance, you’d know that to be completely untrue.
Lenny
Exactly. TTI continually outperforms their competitors. They’re building like crazy in upstate SC.
Cenzo
While I’m no fan of the business of shorting stock. It is interesting to read in yesterday’s news on TTI that they are the target of a large financial group with claims TTI has been manipulating the numbers (accounting). The value of TTI has taken a hit of over 20% down since yesterday’s announcement. Again, shorters are there to bash in order to influence stock prices so I take this information with a very large grain of salt, but I’ve been somewhat suspect of their numbers while most of the rest of the industry has been hammered.
Stuart
I heard.
Someone sent me the report, which includes language such as “Spoiler Alert: We’re not crazy!” and “And hey, what do you know.” They’re not calling into question the revenue or sales performance, but how expenses are reported, alleging that it misleads on profit margins.
The short-seller is heavily incentivized to paint a picture of doom and gloom, and they digress heavily. I found the broad speculations to be distracting rather than persuasive.
Recently, a newly created Twitter account impersonated Lockheed Martin, temporarily wiping out $15 billion in market value.
It will be interesting to see how what happens here.
Dave
This is why you don’t just throw plants where there are big tax incentives and cheap labor. There is no existing logistics there, no contract engineering firms to resolve production or design issues, no local servicing of robotics, assembly line and manufacturing equipment. This reeks of a decision made by a highly educated overpaid exec with little to no real world knowledge.
dstblj 52
I’ll be honest local support beyond local riggers, and electricians is kinda rare these days. If you need a factory certified tech to work on most modern machines, they are flying in basically no matter where in the world you are.
George
The facility in Clinton, MS is an older plant that once housed Delphi Automotive. They produced wiring harnesses for GM.
Milwaukee is currently building a new plant in Grenada, MS, about 100 miles north of Clinton. Should be up and running later this year or early. 2024.
Most likely, employees at Clinton will be offered jobs at Grenada.
Jim Felt
George. Thanks for the background.
I’m sure many of us here never considered it was a converted former GM plant. That alone seems like a cause of potential misunderstanding of Milwaukee’s core requirements for a modern plant.
MS. LADY
That location will not be open for 9 to 12 months from now…Clinton will be closed before then…we were told they will start moving some of the productions line April 1st….Some lines are going to China and some are going to Mexico…
Dave P
“Milwaukee made it very clear that the decision to close the Clinton facility is not a reflection of poor performance,”
I’m not saying that Milwaukee is sinking by any means, but how naive would someone have to be to believe a press release or anything that come out of the mouth of whoever is delegated to handle inquiries on such stuff.
Just ’cause they say it’s so, doesn’t mean it’s so.
Not by a long shot. They don’t tell the minions why they do ANYTHING; no business does. That would be suicidal–or at least that’s what they’re taught from day one.
Always put a positive spin on EVERYTHING and never admit to ANYTHING is corporate relations RULE # 1.
H
Lol take the tinfoil hat off dude. They did the math and it’s cheaper to make these tools in the new Grenada facility… so they closed this one. Pretty straightforward really.
Mateo
If it was “simple math” don’t you think they’d have done that before flushing millions? Surely they employ one person that can do “simple math”.
It doesn’t say the sky is falling on Milwaukee but it does say something. At the very least organizing and spooling up their stateside efforts is a bit trickier than expected and there’ll be some messes and “casualties” along the way.
H
The Grenada facility didn’t exist when they opened up the Clinton location. The company grew, plans changed and so did the math. They realized it makes more sense to manufacture the same tools in Clinton instead. Assuming this closure is a commentary on all of their US manufacturing efforts is quite the assumption when they have 10,000 employees in the US and this effects 150 of them.
Michael Hammer
@H
I’m with you. I get the feeling there was a calculated risk rehabbing an existing facility or may have been the plan all along to shut it down. Why build a new facility just one hundred miles away? Who knows all the variables at play? I just don’t think it was a blunder or that opening manufacturing in America is more complicated than they thought.
Stuart
@Dave, What’s your point?
You’re entitled to your skepticism, but I take offense to being called naive. You don’t know who I spoke with, what they said, or how long I’ve known them.
There’s no positive spin on this, it’s a crummy situation for everyone. There’s no positive spin when people’s lives and livelihoods can be affected.
The closure isn’t set to start for a few months, and at that point it will happen gradually through the end of the year. That makes the situation less worse than if they closed everything at 5pm on a Friday and told everyone not to show up on Monday. But I wouldn’t call it a positive spin.
John
If you know anything the construction industrys and tools across the board, Milwaukee is doing better than most, If not at the top of its market. Just because you like other brands dosnt make them better or more profitable. I buy and sell tools every day , Milwaukee keeps its value and is the most request in my areas .
Harry
I might have missed it but, what did Milwaukee make at the Clinton, MS facility?
D3t
From a news article announcing Milwaukee coming to Clinton:
“This will act as an expansion of its current facility in Jackson and will help support its growing power tool accessories and power tool business.”
Complete article: https://www.wapt.com/article/milwaukee-tool-increasing-presence-in-mississippi-with-expansion-into-clinton/37384258
Hon Cho
After my initial comment on financial incentives, I starting searching for what Mississippi has given Milwaukee. In the 2022 incentives report from the Mississippi Development Authority, Milwaukee was provided a whopping $26 Million in 2021 for the promise of 1200 jobs which I believe included the Clinton jobs. In 2017, Milwaukee received $1.5M for a total $7M investment in the now closing Clinton location.
While I understand why state and local governments play the incentives game, it’s very risky for the government and often the taxpayers don’t get the expected value for the money. Instead of giving profitable businesses money, investing directly in better education, infrastructure and desirable communities would likely be a better long term investment but it is a chicken and the egg kind of problem of how to get to the best outcome for a community.
Bob
Only about 150 employees will be affected, out of the over 4,000 employees Milwaukee has in the state. That sounds like this was a relatively small operation at an old facility.
John
The problem with government making investments in private business is that the politicians are investing other peoples money not their own so there is no skin in the game by the political “decision” makers.
The argument of the greater good can surely be made but government is rarely an efficient arbitrator of money and resources.
Peter
The best thing the government can do is reduce the already burdensome taxes and regulations preventing business to move back to the US. That’s the only long term solution.
Derek Howe
+1
Paul Udstrand
Contrary to popular fantasy, tax cuts are not the solution to EVERY problem or issue. If tax cuts brought jobs back to the US we never would have had an offshoring movement in the first place.
Franco
While some of what you say is true, keep in mind that when governments invest (give money), many are successful and remain for many years; the ones that close, are a small percentage.
Then there is the big picture…”$26 Million in 2021 for the promise of 1200 jobs”. If this is true, we’ll say the average salary is $35k (just a guess), I don’t know the tax rate but we’ll say they paid about$12k income tax (again, just guessing the amount). $12k x 1200 employees = $14.4 million/year or $1.2$ million per month. How many months will the Clinton employees work and pay taxes?
It is not clear when they say 150 employees are impacted, is that the total number of employees at Clinton, or is 150 the amount that will be unemployed while other Clinton employees are transferred to the other nearby plant. But the $26 million did not all go to Clinton, maybe less than 1/2 or even a 1/4 went to Clinton.
If you go deeper into stats, how many were unemployed and the government was paying them some sort of unemployment benefit or other But now had a salary and contributed more to the local economy? And the numbers can go much deeper than that.
Meanwhile, many jobs Milwaukee brought in will stay at the other plants and continue to bring in money to the Government.
I just quickly put some numbers together, but all in all, it is not a “bad” investment when governments makes these grants, investments, “gifts”.
Chris I
Yay capitalism and that good ol’ free market enterprise looking for government handouts, eh?
Albert
This news interview from only a year ago shows corded Sawzalls. I’m going to assume that is the product being manufactured, or they wouldn’t display three of them during the interview:
https://www.youtube.com/watch?v=W1bDYNKyFWE
That is too bad, even thought it isn’t cordless or brushless, but it is an excellent, long-lasting tool. As for shiny sockets, ratchets, wrenches, screwdrivers and pliers, who cares.
John
Does Milwaukee make any power tools in the US? I thought it was only hand tools.
Stuart
To my knowledge, all corded Sawzalls, Packout vacuum, many types of power tool accessories (bi-metal hole saws, carbide and bi-metal recip saw blades, step drill bits), and the upcoming line of hand tools.
Frank
They also laid off all their Hart tool reps…that where servicing the 4000 Wal mart stores…that’s gonna cost them some business.
Stuart
Milwaukee Tool has nothing to do with Hart.
Albert
They are both Techtronic companies. The owner calls the shots, no matter what some people might think.
I really like Red Tool Store.
Stuart
If you believe I am wrong, please explain how you think Milwaukee Tool is responsible for anything that has to do with the Hart brand.
Albert
I think Techtronic told Milwaukee to cut costs, and they obeyed. I think Techtronic told Hart to cut costs, and they obeyed. This is because Techtronic owns Milwaukee and Hart and the owner calls the shots.
Stuart
Frank implied that Milwaukee laid off Hart reps, which isn’t possible. I haven’t heard of Hart Tool layoffs, but if there are, they have nothing to do with Milwaukee.
You’re speculating that the closure came from calls to cut costs, and has nothing to do with supply chain optimizations. It’s possible, but I haven’t seen or heard anything that could support this.
Steve C
Albert,
Milwaukee is a wholly owned subsidiary, while Hart, Ryobi, and Rigid are licensed brands operated by “One World Technologies” of TTI.
Milwaukee has its own executive team and operates independently. Parent companies have a LOT less control over subsidiaries than they do over divisions.
fred
Perhaps to further complicate things – The Ridgid (not Rigid) trademarks are owned by Emerson Electric and their subsidiary The Ridge Tool Co. (aka Ridgid Tools). Emerson seemingly licenses the brand name to Home Depot for use on tools from other OEMs that do not compete with products produced by Emerson. That seems to exclude many plumbing tools that bear the Ridgid brand name and are produced by Ridge Tool in Ohio. Most if not all of the Ridgid branded small power tools, sold at Home Depot, are manufactured by TTI with the brand name used under license. Ridgid brand vacuum cleaners sold at HD still seem to be made by Emerson.
Wit Ryobi – as you say – the brand name is used by TTI under license from Ryobi Ltd. of Japan. If you want to purchase a printing press made in Japan – it might well be a Ryobi – that has nothing to do with TTI. here is what Ryobi LTD says about their power tool businesses – which differ depending on your location in the world – some places aligned with TTI – while in other locales with Kyocera:
https://www.ryobi-group.co.jp/en/news/powertools/006732.html
bigbully
I haven’t heard this – do you have a link or anything to back this up?
Kirk
Someone here may have already mentioned it but imo with Milwaukees ridiculous high prices causing low sales and maybe the closing is due to not meeting Milwaukees high standards with quality materials
OhioHead
^ LOL about MKE making/producing “high quality” tools, how quickly we forget about last summers warning/stop use of MKE cordless Impact Wrench (v2) falling apart in users hands………
I do not work for a competing tool company, my above example IMO MKE “thought” they found a cheaper way to make an impact wrench mechanism (bean counters won) , MKE lost a lot of credibility w/ the re-design.
It happens every day in a variety of industry’s and in the tool world.
Proud owner of a corded Super Sawzall made is MS circa 2002/2003 (w/ twist lock)!
Nathan
A flavor of the area says it’s partly due to 2 things. They over predicted growth for this year and the issues in Jackson, with water and crime. Since Clinton is on the same water district they are delaying using the plant further until it is needed. I suspect it will turn into a distribution center before too long.
Or that’s a bit of what’s going around down here, I happen to live in MS.
fred
For a northerner – I’m more separated from issues in your state. But I was quite surprised when the TV news, up here, reported on the water crisis unfolding then continuing in Jackson. I found it hard to fathom the systemic problems being reported – especially considering Jackson’s status as the state capitol. My wife and I have visited your state several times – having pleasant and educational experiences – mostly stopping in Biloxi, Natchez and Vicksburg – so I do not have a feeling for what Jackson and its environs are like.
D3t
The city of Clinton has no ties to Jackson’s water system. They have their own wells.
Skyy
Is this their new hand tool factory?
Stuart
No.
eddie sky
Guess we’ll see more of the likes of “Model B revision” anvil breakage like the ones of the 1/2″ Impact tool.
Stuart
I don’t see how that could be related. Please explain.