NO LOVE AT CAPITAL ONE (UPDATED)

 Am I Next? No love at Capital One -- Additional Layoffs

OCTOBER 14, 2018 — AND IT GETS WORSE

Capital One has announced that it will lay off more than 150 employees in Lincoln, Nebraska, who service the sporting goods and apparel retailer Cabela's credit cards. Cabela’s credit card servicing will be transferred to another Capital One facility.

Original Post…

McLean, Virginia-based Capital One is laying off an additional 286 employees associated with its mortgage lending operation as it sells off its $17 billion mortgage portfolio to DLJ Mortgage Capital, a subsidiary of the Zurich, Switzerland-based Credit Suisse. 

The current layoffs are in addition to the 950 employees which, according to a previous announcement, will be laid off as the bank exits a mortgage business that is impacted by rising interest rates, a decline in refinancing activity, and increased regulatory scrutiny of the secondary mortgage market.

Are you wondering, Am I Next? 

NO LOVE AT AKER PHILADELPHIA SHIPYARD

 Am I Next? Layoffs at Aker Philadelphia Shipyard, Inc. 

As we have seen in previous blog posts on Jeffboat (Jeffersonville, Indiana) and BAE Systems’ shipyard (Mobile, Alabama), a significant downturn in shipbuilding, repair, and maintenance is now coming to Philly Shipyard (Philadelphia, Pennsylvania).

Philadelphia Shipyards, majority owned by Norway-based Aker Capital will be laying off 275 employees and contractors as its backlog of builds dwindles to zero. Although the company does not have a backlog, work on the two remaining 850-foot cargo ships, the largest container ships built in the United States will continue until completion.

The company’s business relies mostly on ships purchased to fulfill the requirements of the protectionist "Jones Act" which requires cargo shipped between U.S. ports to travel on American-made ships. Most of the traffic is restricted to Pacific destinations between the Continental United States and Hawaii, Alaska, Puerto Rico, and Guam. 

Much of the competition for massive container ships come from China and Koreas where labor is cheap and the ships are simply modular units cobbled together. Not only are the ships larger, they are less expensive as it is estimated a U.S.-built ship can cost up to four times its foreign counterpart. 

The company does not anticipate seeking government assistance to stay afloat as it has in the past – but that is always a possibility. Whether the Trump Administration would be open to supporting a foreign-owned U.S. operation to preserve jobs is unknown. More comprehensive details on the company and its future can be found here

Are you asking yourself, Am I Next?