Management

Navistar expects $22M annual savings in engine production move

Thomas McMahon
Posted on February 21, 2014

Navistar International Corp. on Thursday unveiled plans to consolidate its mid-range engine manufacturing, a move that officials described as “an important next step” in the company’s turnaround efforts.

Navistar, which is the parent company of IC Bus, will move mid-range engine production at its Huntsville, Ala., plant to Melrose Park, Ill. The Melrose Park plant currently builds Maxxforce inline six-cylinder engines.

Company spokesperson Elissa Maurer told SBF that Navistar’s mid-range portfolio includes the MaxxForce 7, MaxxForce DT, MaxxForce 9 and MaxxForce 10.

The MaxxForce 7 and MaxxForce DT engines are used in IC Bus school buses, along with the newer option of the Cummins ISB6.7.

Maurer said that after this summer, only big-bore engine production will remain in Huntsville. The company will continue to build its 13-liter engine at its Huntsville big-bore engine plant.

Navistar Chief Operating Officer Jack Allen said in a statement that the company has “too much excess engine manufacturing capacity in North America, and we must take action to reduce our costs and improve the business. The consolidation will further lower the company's breakeven point, strengthen our competitiveness in the marketplace and help position Navistar for a return to profitability."

The move is expected to eliminate about 280 jobs at Huntsville and reduce Navistar's operating costs by about $22 million annually.

"Ending production at a facility is a difficult decision because of its impact on the many great people who've been part of our company," Allen said. "We understand that these decisions have an impact on our employees and the community, and we will treat our people with dignity and respect throughout this process."

Related Topics: Alabama, engines, IC Bus, Illinois

Thomas McMahon Executive Editor
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