Polaris Industries Inc. (NYSE:PII) is executing its global realignment strategy, one that will affect 110 positions, including some in Medina and Plymouth, Minnesota. It also involves 170 employees who were reassigned to different departments. And, yes, there will be some Polaris layoffs.
The Medina-based company said the realignment included 45 layoffs that started on October 18. The remaining 65 positions were either contractors or open jobs that are not being refilled. Polaris employees who lost their jobs will receive severance packages and outplacement assistance.
While the manufacturer of ATVs, snowmobiles, motorcycles, and electric vehicles did not say which Polaris locations were affected, several employees from Plymouth and Medina have been identified as those whose jobs were eliminated. In addition to Plymouth and Medina, Polaris also has facilities in Roseau, Minnesota, as well as in the states of Alabama, Iowa, and Wisconsin and the countries of India, Mexico, and Poland.
According to Polaris, the reorganization is expected to help the company grow and become more efficient. Others, however, think the cost-cutting measures are related to the company’s massive vehicle recall problem, in which Polaris recalled more than 450,000 vehicles over a three-year period.
Because of the recalls, Polaris has had to pay millions in warranty costs and been sued by plaintiffs after riders who were injured, burned, or killed riding Polaris vehicles.
The news of the global realignment comes less than a month after Polaris announced that third-quarter revenue increased 25% year-over-year to a record $1.47 billion. Third-quarter net income was up 153% at $81.9 million, or $1.28 per diluted share, compared with net income of $32.3 million, or $0.50 per diluted share, for the 2016 third quarter.
Adjusted net income for the third quarter was $1.46 per diluted share, up 192% over the same prior-year period.
Polaris’ realignment strategy includes shuttering its production plant in Milford, Iowa at the end of the year. The closure will result in 300 layoffs. Production is being shifted to existing Polaris facilities in Huntsville, Alabama; Roseau, Minnesota; and Anaheim, California.
Polaris also plants to transfer fabrication operations for its “Pro Armor” aftermarket products from its Riverside, California facility to its recently acquired Transamerican Auto Parts facility in Chula Vista, California.
“Polaris realigns, eliminating 110 positions,” Star Tribune, November 10, 2017.
“Polaris Reports 2017 Third Quarter Results,” Polaris Industries Inc., October 24, 2017.
“Polaris to shut down manufacturing in Milford; up to 300 jobs to be cut,” Sioux City Journal, April 25, 2017.