John Walko EE Times Europe (05/20/2009 7:08 AM EST)

LONDON — Litttelfuse Inc., the Chicago headquartered provider of circuit-protection products, is closing its manufacturing plant in Duensen, Germany, and shifting production to Mexico as part of a number of measures being taken to reduce costs.

Littelfuse said it expects to save $7 million a year from the restructuring. It added it expects to book restructuring charges of approximately $5-8 million pre-tax over the next several quarters as a consequence, and that the moves would be completed by the end of 2010.

Research and development, as well as a European sales office would remain at Duensen. The company has commenced consultation with the workforce at the German facility about the closure.

Negotiations have also started about the closure of a distribution center in the Netherlands and once completed distribution in Europe would be handled through a third party.

The company said it would consolidate a wafer-fabrication facility in Taiwan, bought as part of the Concord Semiconductor acquisition in 2006, into its manufacturing operations in Wuxi, China.

Other workforce reductions due to "functional realignment" are also in the pipeline, the company warned.

"These latest restructuring plans are consistent with our overall themes of reducing sites, moving activities to low-cost locations and moving to a leaner and flatter organizational structure," said Gordon Hunter, Chief Executive Officer, in a statement.