Cummins Inc. is temporarily shutting down all its southern Indiana manufacturing plants beginning next week in a staggered schedule in response to the market disruptions caused by the COVID-19 pandemic.
The shutdown includes the Columbus Engine Plant, the Fuel Systems Plant (FSC and XPC), the Seymour Engine Plant and the Columbus MidRange Engine Plant, said Jon Mills, Cummins spokesman.
The announcement affects a couple of thousand employees in southern Indiana, the company said.
The layoff would mean the employees will not be paid by Cummins, but they will continue to have medical, dental and life insurance benefits for 90 days, Mills said.
The plant closings are being staggered to ensure the company builds enough inventory to meet customer demand, according to a company message to employees. Planned reopening for all the plants is scheduled for May 4, subject to change depending on demand, according to the company.
The company’s southern Indiana warehouses will remain open during the shutdown to support aftermarket operations. The company also said all technical centers, parts distribution centers and locations also will stay open, while adhering to all cleaning and safety measures.
Cummins’ MidRange Engine Plant in Walesboro, with about 900 employees, has been on a two-week shutdown since March 20. Mills said the plant supplies a facility in Mexico with the Dodge Ram engine.
Fiat Chrysler, the maker of the Dodge Ram, had temporarily halted production in North America due to the COVID-19 pandemic.
Mills said if Fiat Chrysler resumes production on April 13, as the company has predicted, the Cummins MidRange Engine Plant would return to work on April 16.
For the second quarter and perhaps into the third, the company has instituted pay cuts that include a 50% salary reduction for Chief Executive Officer Tom Linebarger, a 25% cut in director compensation and a 10% to 25% cut in salaries for all other U.S. employees.
Cummins has more than 10,000 employees in Indiana and 60,000 globally. Its greater Columbus workforce totals more than 8,000.