Plant to shut down
By Staff Reports
Aug 16, 2013, 14:28
PETERSBURG — Boehringer Ingelheim Chemicals Inc. announced that the company will close its Petersburg plant at the end of 2014, laying off 240 employees.
The closure will occur through a multi-stage process starting in December 2013.
“This was a very difficult decision and one that we did not make until we had explored all of our options,” said Dr. Manfred Psiorz, president and CEO of BI Chemicals, in a press release Thursday. “We wanted to give our employees as much notice as possible, so they have time to explore other employment opportunities. At this moment, our primary goal is to support our employees.”
The direct loss to Petersburg by the closure of BI will be over $2.5 million dollars per year in machinery and tools taxes, and over $385,000 in real property taxes. Petersburg will also see an undetermined loss in revenue from the money BI employees spend in the city.
“We are concerned when any of our industries or businesses leave the City. This will be a loss to Petersburg and the region,” said Mayor Brian A. Moore.
Petersburg officials said they are working with BI to determine the best use of the Petersburg site, and the immediate marketing of the facility to other industries. “We are requesting that our State and Congressional representatives assist and provide resources to market the site globally” said City Manager William E. Johnson III. The BI property is located just off I-95 at the Wagner Road exit, which makes the facility attractive for the movement of products to the Port of Hampton and throughout the country.
The company announced it will be offering out-placement services and will reach out to industry partners to explore other opportunities for employees.
The Petersburg facility manufactures active ingredients for the pharmaceutical industry. BICI’s parent company conducted an exhaustive review of its current manufacturing capabilities world-wide, as well as needs in the industry, and determined that it had more capacity than the marketplace can sustain.
“The pharmaceutical industry is going through dramatic changes and manufacturing needs are being impacted by that change,” Psiorz said. “Our employees did a fabulous job operating this plant, but this decision was driven by factors in the market that were beyond our control.”
Business leaders said the decision was a blow to the city.
“While the announcement today is not a complete surprise, it is nevertheless difficult news for our community of employees and their families,” said Danielle Fitz-Hugh, president of Petersburg Chamber of Commerce.
“The Petersburg are has many positive things going on within the area, and despite today’s announcement, it’s important that we keep this momentum going and continue to attract new business and help existing business grow as well as perform well.”
Boehringer Ingelheim Chemicals explored selling the facility but was unable to find a suitable buyer. The company has committed to working with city and state officials to find an appropriate use for the facility.
“This is a top tier manufacturing plant,” Psiorz said. “We will do all that we can to help the city find an appropriate use for this location.”
The company announced it will begin working with its customers immediately to ensure a smooth transition to new suppliers.
The Boehringer Ingelheim group is one of the world’s 20 leading pharmaceutical companies. Headquartered in Ingelheim, Germany, it operates globally with 140 affiliates and more than 46,000 employees. Since it was founded in 1885, the family-owned company has been committed to researching, developing, manufacturing and marketing novel medications of high therapeutic value for human and veterinary medicine.