Nearly two years after the doors closed on the Webster City Electrolux plant, the appliance maker has announced it is moving 80 technical jobs from Webster City to its North American headquarters in North Carolina.
Electrolux officials said Tuesday that product design and testing will be discontinued at the company's Webster City site in the third quarter of next year.
The Sweden-based appliance maker moved its North American headquarters from Georgia to Charlotte, N.C. in July 2010 in return for state tax breaks and grants worth up to $26 million, plus more from local governments.
The washing machine and dryer manufacturer closed its Webster City plant in March 2011, leaving more than 700 workers without jobs. In September 2010, the city of Webster City and Electrolux came to an agreement to help keep 80 tech jobs in Webster City. Under the agreement, Electrolux Home Care Products would donate the former Electrolux Central Vacuum Systems plant (originally known as Beam Industries) on West Second Street, to the city for $1. The city then leased the building to Electrolux Major Appliances as the location for the fabric care technology center.
At a City Council meeting in September 2010, the council approved the lease agreement. At the time, city officials anticipated that the company would spend about $1 million in improvements and that the city would contribute $150,000 for job retention.
"If they break the lease before four years, they will owe us $50,000. If they do not keep at least 50 people on staff after five years, they will start paying us rent," City Manager Ed Sadler said at that 2010 council meeting. "We want to make sure the building's not just used for storage. The whole point is to retain and create jobs."
"We are pleased that the gift of our building to the city is helping to retain these good technical jobs," Russ Minick, then CEO of Electrolux, said at the time the agreement was signed.
The announcement of the move came as a surprise to city officials and economic development entities. Sadler said Tuesday there were no talks with Electrolux prior to the announcement.
"There was no contact. We got an email. That's how we found out," he said.
Sadler said Tuesday that he was receiving calls from the media before he received notification from Electrolux.
"We gave them $150,000 for several million in remodeling improvements that they did out there," he said.
"We had always anticipated at least five years. Well, obviously that wasn't the case."