Sub-Zero Sales Plummet. Threatens to Close Wisconsin Factory.

Sub-Zero, the big Kahuna of high end appliances has confirmed what we all long thought, that all ain't peachy in Wisconsin.  Sub-Zero is considering drastic changes to one of its Wisconsin plants, either:

• forcing the 200 employees of its Fitchburg Wolf plant to accept a 20% pay cut.
• closing its Fitchburg Wolf plant and shifting production to Sub-Zero's never used dishwasher plant in Richmond, Kentucky
• or, believe it or not, both

Sub Zero has also purchased a 440,000 square foot plant in Goodyear, AZ where it will shift production from its Phoenix refrigerator plant which is half the size.  Only the daft can't see that the size of the new plant lends itself to taking over some or all of the fridge production that remains in Madison, WI

Evidently, a falling tide lowers all boats, including the "do no wrong" brands of Wolf and Sub-Zero.  The spectacular growth of SZ was built not on the backs of the rich, but on the backs of the middle class who wanted to feel rich.  Sub Zero and Wolf were icons of wealth which were just about attainable by the middle class, but in this recession, the middle is simply focused on not loosing ground.  They can no longer play out of their league, and there's no one else to pick up the slack.
There are not enough actually rich people to support the investment, KBIS space, sales force, line extensions, corporate dining rooms, downtown refurbishments, Hollywood product placements, dealer factory tours that marked the last two decades of the high end behemoths.

Though this conversation will certainly degrade to the pros and cons of unions, the most important point here is that Sub Zero, almost 2 years since the beginning of the national recession, and 3 years since the appliance recession, has not found a way out of its sales collapse.  No international sales, no sub-tier brands or less featured products.  Nothing creative, nothing offensive, no interesting marketing plans, no must have products or newly minted segments.  The best idea that Sub-Zero can think of is a pay cut of $200,000 per month, for a total savings of $2.4 million per year.

This is a purely defensive play by a company built to serve a market that to a great measure, no longer exists.

For the full story see WISC TV:  Don't forget the hundreds and hundreds of comments on the WISC site.  Interesting stuff all..........
Jul 16 2010:  Wolf Appliance Threatens To Move Fitchburg Plant To Kentucky

Jul 16 2010:  Fitchburg Mayor Concerned About Wolf Appliance Situation

Also see the Wisconsin State Journal

And recent stories in ApplianceAdvisor.com about Sub Zero
Oct 8 2009:  Hiring:  Sub Surfaces

Feb 22 2010:  Sub Zero Just Another Brand Now

Jun 1 2010:  Green Washing: When the Only Thing Green is Money