Peloton subsidiary Precor Manufacturing is laying off 123 employees upon the closure of its facility in Whitsett, North Carolina, according to a Worker Adjustment and Retraining Notification (WARN) Act notice dated March 9.
Layoffs, which began March 9 and will run through Oct. 31, are taking place due to a business restructuring and employees will not have bumping rights, according to Peloton’s WARN letter.
“We can confirm that we eliminated a number of positions across Precor,” a company spokesperson said in an email to Manufacturing Dive. “These decisions are never easy, and we want to acknowledge the work and contributions of the colleagues who have been directly impacted. The goal of the changes we are making is to strengthen our operations, return Precor to growth and ensure we are delivering on the needs of our customers.”
Peloton President and CEO Barry McCarthy said in a February earnings call that the company has been exploring the sale of Precor despite acquiring the company in 2020 for $420 million.
The acquisition was initially intended to increase the production capacity of Peloton’s exercise bikes and treadmills. Since then, Peloton has decided to grow Precor as a free-standing business.
“That's the path we're on,” McCarthy said on the call. “And when we see success, we will see a dramatic increase in its market value. And then unless we have a shift in strategy where they have a shift in their product strategy. At some point, we would look to divest.”