DANVILLE, Va. - IKEA announced Wednesday that it's closing down its Danville manufacturing plant.
At face value, many in the area see this as a disappointing hit, as the plant provides hundreds of thousands of dollars a year in tax revenue to the city. On top of that, 300 people will be losing their jobs.
Danville receives about $276,000 a year in taxes from the plant, according to Michael Adkins, the city's finance director.
The plant also provides tax revenue to Pittsylvania County.
IKEA's announcement was somewhat of a shock to Danville City Manager Ken Larking.
"We are constantly communicating with our local industries to see if there is anything that we can do to help them be successful. We knew that there were some issues that they were dealing with, but we hoped it would never come down to something like this," said Larking.
He says this does not mean the sky is falling as not all of the tax revenue will be lost.
"Real estate taxes will still apply whether or not there is a company actually in that building or not. I will say, this building is an attractive building. It's not but 10 years old. It's a million square feet. It's got access to rail, good access to transportation, so it will be an attractive building for another end user," said Larking.
IKEA's board decided to move the plant to Europe because raw materials are much cheaper there, according to site manager Bert Eades.
"The coworkers here are going to be our highest priority and we're going to do everything we can to support them in finding other jobs," said Eades.
And Danville's Economic Development director is trying to make sure the city is there for them as well.
The union that represents the plant's employees released this statement Thursday afternoon:
“The IAM is meeting with our members in Danville, Va. and will keep our membership and the community informed of any updates. We are working on solutions, including conversations with IKEA corporate leaders and allies overseas, to stop the closure of the company’s Danville production facility. We hope we can work together with all stakeholders to stop this job loss.”
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