Key Tronic Lays Off 200, Halts Laptop Development

SPOKANE - Key Tronic Corp., a computer-keyboard manufacturer, said yesterday it has laid off 200 workers and halted development of a new laptop computer.

The company had employed 2,000, about 1,750 of them at plants in Spokane and nearby Cheney and the rest in Ireland and Taiwan. All the workers being laid off are domestic.

Key Tronic said in a statement the reductions affected all levels of the company including top management, where staffing has been cut from 14 to six.

"These painful but necessary changes are the first step in the company's plans to return to profitability," said Wendell Satre, acting president and a member of the board of directors.

Satre said the layoff was prompted by Key Tronic's financial losses during the current fiscal year, the company's decision to halt development of its laptop computer and softness in the computer industry.

"The company is re-emphasizing its core keyboard business," Satre said.

Key Tronic makes a variety of molded-plastic electronic products, as well as computer keyboards.

Company officials had said their effort in the past year to move into the expanding market for laptop, or "notebook," computers was intended to offset declining profits from keyboard manufacturing.

Satre said yesterday the company will limit its efforts in the laptop market to producing molded-plastic enclosures for the computers.

The layoff announcement comes less than a month after Alfred Zirkle resigned as board chairman, chief executive officer and president. His resignation came months after he had replaced his father, company founder Lewis Zirkle.

Alfred Zirkle said he resigned, in part, because of differences with the Key Tronic's board of directors.