From USA Today: Stanley Black & Decker said Thursday that it would open a new $35 million manufacturing plant in the U.S. after acquiring the Craftsman tool brand from ailing retailer Sears Holdings.
Expanding American manufacturing makes “business sense” amid “pervasive” uncertainty regarding the future of U.S. trade with China and Mexico, Stanley Black & Decker CEO James Loree told investors Thursday in a conference call.
Although he did not mention Donald Trump by name in his remarks to investors, Loree’s comments had all the hallmarks of an effort to inoculate his company from the possible effects of the president-elect’s threatened “border tax.”
“We view it sort of as one of several political movements, or concepts, that really drive us to this concept of make-where-we-sell,” Loree said. “It’s going to be advisable to have more manufacturing in the U.S.”
Stanley Black & Decker has about 3,000 U.S. manufacturing jobs today, up 800 from three years ago, according to a company presentation. It was not immediately clear how many jobs the company plans to add.
Loree said the location of the new manufacturing plant to produce Craftsman products has not yet been determined. The company currently operates 29 total U.S. plants.
About a half century ago, the Craftsman brand was primarily made in America. Today it’s largely made overseas, Loree said. “We believe this is an excellent opportunity to re-Americanize and revitalize this legendary brand,” he told investors.
In addition to the threat of trade policies that could damage imports, manufacturing products in the U.S. to sell to American consumers reduces logistics and distribution costs and lowers the company’s environmental footprint, Loree said. “It makes good business sense for us,” he said.
Stanley Black & Decker paid about $900 million to acquire Craftsman from Sears, which is closing stores and selling assets in a bid to stay afloat following a series of steep losses. About 90% of Craftsman products are sold in Sears stores, but Stanley Black & Decker plans to expand production and sales to other retailers and business channels.
Stanley Black & Decker shares rose 3.5% to $120.54 shortly after the opening bell Thursday.