CCT Announces Layoff of Workers in Tijuana, S.D.

Citing a dramatic downturn in demand for its computer data storage products, CCT Corp. is laying off “significant numbers” of employees at its Tijuana manufacturing plant and at its San Diego headquarters offices, the company confirmed Tuesday.

Chairman Everett Bahre refused to comment, however, on reports from reliable sources that hundreds of employees are being let go at CCT’s Tijuana operations, where the company employed 1,600 at its peak. Most of the layoffs are at CCT’s Information Magnetics subsidiary, sources said.

Bahre also refused to give out specific numbers of administrative employees being laid off in San Diego, where CCT employs 200. As of Jan. 30 of last year, CCT’s payroll included a total of 4,100 workers.

“We are experiencing significantly weakened demand,” Bahre said Tuesday. “We are taking immediate steps to reduce manufacturing and support operations . . . to position ourselves for profitability at lower anticipated sales volume.”

Last month, CCT announced that it expected to “record a substantial loss” on reduced sales for the fourth quarter ended Dec. 31. Over the same period last year, CCT reported a profit of $1 million on sales of $24.3 million. The fourth-quarter loss will result from lower sales volume and costs related to “consolidating manufacturing operations,” Bahre said.

CCT makes recording heads used in disk drives, a computer data storage device. The disk-drive industry in general has entered a significant slump over recent months because of over-capacity. Major disk-drive manufacturers, including Micropolis and Seagate Technology, both of which are CCT customers, have laid off hundreds of workers.

With regard to consolidating manufacturing operations, Bahre declined to give specific information on which of its facilities are being affected and how. In addition to its 100,000 square feet of plant space in Tijuana, CCT also runs major manufacturing operations in South Korea and Puerto Rico.

CCT also announced last month that it has entered into an agreement to sell its Zeta Laboratories microwave products unit for about $16 million. The company anticipates no substantial gain or loss to result from the sale, Bahre said.