Gateway Facility Closure to Cut 250 Jobs

As part of its strategy to streamline operations and return to profitability by year's end, the company is closing its Sioux Falls, S.D., facility.

Gateway is planning to close one of its three Midwestern operations at the end of the month as part of its overall push to streamline operations, reduce payroll and return to profitability by the end of the year.

The Poway, Calif., company will close its Sioux Falls, S.D., facility by the end of June, a move that will cut about 250 jobs. Gateway Inc. spokesman David Hallisey said about 300 people work at the Sioux Falls location, which primarily housed sales and support operations. A few dozen of the employees will be relocated to another Gateway facility in North Sioux City, S.D.

The company will move forward with two Midwestern locations in North Sioux City and Kansas City, Mo. Workers in Sioux City were notified Friday morning about the facilitys closing, Hallisey said.

Gateway is still undergoing its transformation following its $289 million purchase of eMachines Inc. in March.

Wayne Inouye, the former CEO at eMachines, has taken over the same post at Gateway, and has overseen the closing of the companys stores, with the idea of selling Gateway products alongside eMachines devices on the shelves of other retailers.

It also is simplifying both its consumer and commercial product lines.

/zimages/2/28571.gifClick here to read an interview with eMachines founder John Hui on the companys business model.

In its attempt to return to profitability by the end of 2004, the company also plans to reduce its overall payroll by more than half, from 3,500 employees to about 1,500. Later this summer, Gateway also will relocate its headquarters to Irvine, Calif., closer to eMachines former base.

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