WILMINGTON, NC (WECT) - Vertex Rail laid off 60 people at its Wilmington facility Friday due to sluggish demand for its sand hopper railcars, the company's legal counsel said.
As a result of the decrease in demand, the company said it will expand its production capabilities to produce new types of railcars.
Vertex is shifting its production focus to the freight car market, including aggregate and food service hoppers. The company said it also will produce food-grade tank cars and crude oil tankers.
Vertex said it received a order this week for more than 600 new DOT-117 tank cars, and it expects additional orders for more than 1,200 of the new type of railcars.
"Railcar manufacturing is a customer-driven industry that sees market conditions and commodity prices change all the time. Because of our global footprint, Vertex understands the challenges that come with the ever-changing nature of the industry," said Vertex CEO Donald Croteau. "We are committed to the railcar market and are willing to invest in our business, our factory and our personnel in order to take advantage of market opportunities as they are presented."
Vertex officials said because of this production shift, they plan to rehire some of the people laid off Friday, possibly as soon as 12 weeks from now.
The company said it will make a significant capital investment in its Wilmington facility to support the new production. Vertex also stated it will adjust its workforce and retrain personnel. Officials say 221 people are still employed at the facility.
These investments will optimize our manufacturing practices, maximize throughput and allow us to respond quickly to new opportunities in the future," said Croteau. "Vertex is very optimistic about our future, and remains committed to growing our business in Wilmington, NC."