Jul. 21--American Commercial Lines Inc., is laying off nearly 10 percent of its workforce at its Jeffboat Manufacturing Division.

Approximately 120 workers will lose their jobs and a portion of salaried employees have been offered a "voluntary separation" instead of waiting to see if they are part of the cuts, said David Parker, vice president of investor relations and corporate communications.

"It's really in response to a prolonged economic downturn and an environment of fluctuating demand at Jeffboat," he said.

With the demand for new manufacturing down the cuts were somewhat expected.

"It's not a surprise to me at all," said Chaz Jones, analyst with Morgan, Keegan and Company, Inc. "Jeffboat's backlog has gone down over 50 percent in the last year."

The cuts announced Monday will occur only in the manufacturing division, but its sole purpose may not be reduction of cost.

"We don't think the headcount reductions at Jeffboat was a function of sustainability," said George Pickral, research analyst with Stephens Inc. in an e-mail. "Rather, we think the decision was about streamlining operations, which has been an ongoing process at the entire company over the past 16 months. Productivity metrics at Jeffboat have improved over the past year, so we think it is a function of needing fewer people to do the same amount of work."

The company has made other consolidation efforts recently. ACL closed its Houston office as part of a business realignment plan in February, relocating and merging some of the jobs to the company's headquarters in Jeffersonville, as previously reported in The Evening News.

The company has also been in the process of reducing the number of employees locally through a voluntary buyout program, since the Houston office closed.

"These actions are necessary in order to sustain ourselves during this economic downturn and will position us for the imminent recovery in the economy," said Jacques Vanier, vice president of manufacturing, in a press release.

"What you're seeing is the business being impacted negatively on a couple of fronts," Jones said.

Barge transportation has gone down with the reduction in overall manufacturing in the U.S. Because the need for barge transportation has been reduced, barge building has been negatively impacted, in turn negatively impacting demand, he said.

"We realize we're a large employer and obviously a workforce reduction is difficult for us," Parker said.