Cummins Filtration, a division of Cummins Inc., announced that it is consolidating a significant portion of its North American filter assembly operations into its facility in San Luis Potosi, Mexico, over the next several months in order to keep the business competitive in this region.

Under the consolidation, filter assembly operations at the Cummins Filtration plant in Lake Mills, Iowa, will be moved to San Luis Potosi, beginning in November. The company also is considering moving additional assembly work from its filtration plant in Cookeville, Tenn., but a final decision has not yet been made.

As a result of the consolidation, the Cummins work force in Lake Mills will be reduced by about 400 workers between November and March 2010. Other operations, which employ about 110 people, will remain at the Lake Mills plant.

The consolidation, which involves assembly of oil and fuel filters, is expected to result in significant annual savings to Cummins Filtration after the costs associated with the action are recouped. The company says the move will be seamless to Cummins Filtration customers.

“The filtration industry has become increasingly price-sensitive in the past several years, and the recent reduction in demand has heightened the need for us to take decisive action to make our business more cost-competitive, both for the present and well into the future,” says Rich Freeland, president of the Components business, which includes Cummins Filtration.

“We have a number of under-used filtration plants in North America, and after considering a full range of factors, it was determined that consolidating much of our filter assembly in San Luis Potosi, which is our most modern and cost-effective facility, offers the business the best chance for long-term success,” Freeland says.

Cummins Filtration currently employs about 330 people in San Luis Potosi and assembles the same type of products as those that will be moved to the plant in this consolidation. The Cummins Filtration operation is part of a larger Cummins Inc. manufacturing campus in San Luis Potosi that also includes engine and power generation equipment production.