Vishay Intertechnology, Inc. (NYSE: VSH), one of the world's largest manufacturers of discrete semiconductors and passive components, announced on Tuesday (Sept.24) a significant restructuring initiative aimed at optimizing its global manufacturing footprint and streamlining business operations. The move is part of the company’s Vishay 3.0 growth strategy and will involve the closure of several facilities and workforce reductions.

The restructuring will occur in phases and include:

● Streamlining selling, general, and administrative (SG&A) functions, affecting 170 employees (6% of the SG&A workforce) through 4Q 2025.

● Closing three manufacturing facilities: a Diodes segment back-end facility in Shanghai, China by 2026, and two small Resistors segment facilities in Fichtelberg, Germany, and Milwaukee, Wisconsin. This will reduce direct labor by approximately 365 employees (2% of the manufacturing workforce).

● Various changes in manufacturing operations and production transfers, resulting in severance payments to approximately 260 employees.

The company anticipates pre-tax cash charges of $38 to $42 million, primarily related to severance costs, with most of the charges expected in the third quarter of 2024. Once fully implemented, the restructuring is expected to deliver annualized cost savings of at least $23 million, including $9 million in immediate savings and an additional $12 million beginning in the first quarter of 2025.

Vishay President and CEO Joel Smejkal stated that the restructuring will enhance decision-making, improve customer focus, and increase cost efficiencies. The initiative is also intended to transition the company toward a campus manufacturing model that supports multiple product lines.

Vishay Intertechnology serves a wide range of industries, including automotive, industrial, computing, consumer, telecommunications, military, aerospace, and medical sectors. The company is listed on the New York Stock Exchange and is a Fortune 1000 company.