Proterra announces 25% workforce reduction, facility closure

In a regulatory filing, the company said, "On January 13, 2023, the Board of Directors of Proterra approved a plan designed to improve operational efficiency that includes reducing the workforce across the company and closing the company’s City of Industry facility. The City of Industry facility currently manufactures electric transit buses and the company’s current generation battery systems. The company will move manufacturing from the City of Industry facility to its existing facilities in South Carolina. Transit bus production in the City of Industry is expected to end in the first quarter of 2023, and battery production at the end of the third quarter of 2023. The company plans to vacate the facility by the end of 2023. The Workforce Restructuring plan is expected to reduce the company’s current workforce by approximately 25%, and impact approximately 300 employees, including from the Facility Closure. The company believes these plans will improve overall efficiency by increasing the utilization of the company’s largest manufacturing sites in Greenville and Greer, South Carolina, streamlining supply chain and distribution logistics, reducing organizational complexity, and reducing facilities costs. Affected employees are expected to be offered separation benefits. The company is beginning the Facility Closure and Workforce Restructuring efforts effective immediately. The final costs relating to the Facility Closure and Workforce Restructuring will not be known until all related activities have been completed. The company currently expects to incur restructuring charges, of between $6 million and $10 million attributable to net cash payments primarily for severance benefits to employees, and $4 million to $5 million in facility closure costs primarily consisting of lease expense, material and equipment relocation and removal of tenant improvements in connection with the Facility Closure. Such restructuring charges are expected to be incurred beginning in the first quarter of 2023 and continuing through year end of 2023. In addition, in connection with the company’s Workforce Restructuring and Facility Closure, the Company is performing an impairment analysis over certain property, plant and equipment and could incur non-cash impairment charges. The company currently expects to use equipment from the City of Industry facility in other locations and is unable to estimate any potential impairment charges relating to the Facility Closure and Workforce Restructuring at the time of this Report."