Updated: 10/9/2009 7:52:01 PM
BAE Systems, a body armor manufacturer in Grainger County, will close its Personnel Protection Systems plant in Grainger County as of December 9.
Without an official count, Grainger County Mayor Mark Hipsher said the company may be the largest employer in the Rutledge and Bean Station area. He estimates the loss of jobs will have a large impact.
Employees manufactured what the company and military called Improved Outer Tactical Vests, basically a vest with armor for military use.
All 204 regular and temporary employees at the plant will be out of work. Regular employees will receive severance benefits and career transition help. Employees will also be able to apply for any open jobs elsewhere in the company.
A statement from Operations Director Bryan Stiles emphasized that the closure is in no way a reflection on the quality of work of the Grainger County employees but instead follows current and projected demand.
In January, the company furloughed most employees after a contract at that time had run out. After three weeks, BAE was awarded a pair of contracts for roughly $70 million that brought the production of 150,000 vests to Grainger County.
Now, those contracts have run out and BAE is not seeing the type of demand needed to continue operations at this time, Stiles said.
Stiles also indicated that losing the bid on the Improved Outer Tactical Vest contract was a significant part of the choice.
By law, United States military equipment must be made in America. The contract BAE was hoping to receive in order to continue operations in Grainger County was awarded to another American company.
As of October 9, Stiles said BAE has several proposals and bids placed for other government contracts. While there is no guarantee it would make business sense, Stiles said if BAE is awarded one or more of those contracts they could re-open the Bean Station plant and bring workers back.
