We will continue to pursue a blended manufacturing strategy with domestic production focused on customized products and certain core bedroom groups that can be delivered to the consumer quickly, and with the majority of major collections being imports
Robert H. Spilman Jr., president and chief executive officer

Bassett Furniture Industries announced today plans to close its wood manufacturing facility in Mount Airy, N.C. The closure of the 540,000 square foot facility will occur in the next 60 days. 300 employees or 15 percent of the Company's workforce will be let go.

The Company plans to move production of certain products from the Mount Airy facility to its wood facility in Bassett, Va., with the remaining product being imported.

"This decision will result in increased capacity utilization in our Bassett plant," said Robert H. Spilman Jr., president and chief executive officer. "We also believe this decision will strengthen our remaining operations and provide better opportunities to be more efficient and competitive while maintaining the quality of our products. We will continue to pursue a blended manufacturing strategy with domestic production focused on customized products and certain core bedroom groups that can be delivered to the consumer quickly, and with the majority of major collections being imports."

At current product demand levels, the Company expects savings from reduced labor and fixed operating expenses of $4.0 to $5.0 million annually once this transition is complete.

"We recognize that our employees at this facility have worked hard to meet the Company's goals and this decision is in no way a reflection upon them," said Mr. Spilman. "Our employees in Mount Airy have been extremely dedicated and loyal employees for many years and we will provide them with assistance to make the transition as smooth as possible under the circumstances."

To aid in the transition of those employees affected by the closing of the plant, the Company has arranged for placement services to be provided by the North Carolina Employment Security Commission. Bassett also plans to file a petition with the U.S. Department of Labor's Division of Trade Adjustment Assistance to establish eligibility for assistance for the displaced employees.

With the closing of the Mount Airy facility, the Company will employ approximately 1,700 people.