Vishay launches global restructuring – closes three plants

Vishay says that these restructuring actions – which are a part of the company's  Vishay 3.0 growth strategy –  are designed to "optimise the company’s manufacturing footprint and streamline business decision making".

Starting immediately and continuing through the fourth quarter of 2025, Vishay says it will streamline its selling, general, and administrative (SG&A) functions. This will involve laying off around 170 employees, or 6% of the SG&A workforce, who will receive severance payments.

The company also plans to close three manufacturing facilities. A back-end facility in the Diodes segment, located in Shanghai, China, is expected to shut down by the end of 2026, with production gradually moving elsewhere starting in the fourth quarter of 2025. Additionally, two smaller facilities in the Resistors segment, in Fichtelberg, Germany, and Milwaukee, Wisconsin, will also close in 2026. These closures will reduce the company's manufacturing force by around 365 employees, or 2%.

Beyond this, the company says that other changes in manufacturing and production transfers will result in severance payments for about 260 additional employees.

The restructuring programs are expected to result in pre-tax cash charges of approximately USD 38 to 42 million, largely tied to severance costs. These charges will be predominantly reflected in the third quarter of 2024. By the time the program is fully rolled out at the end of 2026, the company anticipates realising annualised cost savings of at least USD 23 million. Out of these savings, around USD 12 million is projected to come from reductions in selling, general, and administrative expenses.

Additionally, the company expects to realise immediate annualised cost savings of around USD 9 million. By the first quarter of 2025, Vishay expects to realise approximately USD 12 million in annualised cost savings. 

“As we implement Vishay 3.0, reshaping the Company and preparing for our next phase of growth, we continuously task ourselves with identifying opportunities to best foster a business minded approach to decision making, further enhance our customer first focus and improve cost efficiencies,” says Joel Smejkal, Vishay's President and Chief Executive Officer. “With that in mind, we are undertaking these restructuring actions in part to eliminate barriers to execution and to intensify the sense of urgency. We’re also taking our first step to optimize our global manufacturing footprint, closing smaller single product line facilities and moving toward campus manufacturing structures with multiple product lines.”