Gunite Corporation expected to live up to promise of downsizing

Elkhart, IN - Between 200 and 300 people will be out of work after the holidays, if a Michiana manufacturer makes good on a promise to cut its workforce.

Gunite Corporation will layoff as many as 250 employees in the first quarter of 2007, and could do away with another 150 later in the year.

More manufacturing jobs will be lost in Elkhart, if the trucking business takes a predicted turn for the worse in 2007.

Gunite Corporation announced this week it will cut its workforce in half at Plant One, leaving as many as 300 people without a job.

The company makes brake systems for heavy trucks and has been part of the Elkhart community since the late 1980's.

Jim Szucs of the Teamsters Local 364 said, “The average rate of pay in the plant is $15 an hour. The benefits include no cost sharing for major medical coverage. It would be tough to find a job in this area that would match the pay and benefits that these employees receive.”

Teamster’s Local 364 represent most of Gunite's employees.

They are negotiating incentives for those who plan to stay and work up until the layoffs.

The trucking industry expects to take a hit in 2007 because that's when the Environmental Protection Agency will begin enforcing stricter standards for truck emissions.

When producing the trucks begins to cost more, Gunite expects to sell less. which is why they will need fewer employees, according to their parent company, Acquired Corporation.

“Customers have demanded higher tolerance hubs in volumes that can not be satisfied at the existing Plant One. Our competitors, both in the U.S. and abroad are manufacturing and selling products for significantly lower costs than that which can be produced in the current Elkhart facility,” Szucs said.

Work done at Gunite Plant One will be subcontracted to a company in Rockford, Illinois, leaving part of an Elkhart workforce that has decades of seniority, out on the street.

Employees at Gunite are focusing on keeping there jobs in the short term, which is why the workers NewsCenter 16 spoke to were reluctant to go on camera.

Elkhart truck brakes facility to lay off 200 to 300

Jobs at Elkhart plant could be cut in early 2007.

ED RONCO
Tribune Staff Writer

ELKHART -- Between 200 and 300 people will lose their jobs in early 2007 when Gunite Corp. lays them off from a plant here.

Gunite makes brake systems for heavy trucks at a plant on the corner of County Road 15 and Middlebury Street in Elkhart.

The company doesn't know exactly how many workers will be affected, said Eva Schmitz, a spokeswoman for Gunite's parent company, Evansville, Ind.-based Accuride Corp.

Accuride is not connected to the company of the same name that shuttered a South Bend plant in 2002.

A smaller complement of workers will remain at the plant, known as Plant 1, while other work done there will be subcontracted to Cherry Valley Tool and Machine of Rockford, Ill., Schmitz said.

The plant in Elkhart employs 510 people, 430 of whom are hourly employees represented by Teamsters Local 364.

The layoff announcement, made in shifts Sunday and Monday, was a total surprise to workers, said Jim Szucs, business agent for Local 364.

"This news hit us like a ton of bricks on Sunday night and Monday," Szucs said.

The company and the union are expected to meet next week to discuss an incentive program for workers who stick around until they are laid off.

But other than that, "it's a little bit too early to know where we're going to go," Szucs said.

Employees who remain will receive an incentive package that has yet to be worked out. The retention pay, as it's called, will likely be built around factors such as productivity, minimization of scrap material, plant safety and attendance, Szucs said.

Since companies are required to give 60 days' notice of closures or layoffs to workers, many put forward incentive plans to keep employees productive as the layoff date gets closer.

The automotive supply industry has grown increasingly competitive, especially from sources abroad.

It's unclear whether foreign competition was a factor here, but employees in the plant were acutely aware of industrywide issues, Szucs said.

Not like that makes this any easier.

"(It's a) very somber mood," he said. "It still hits very hard when news like this is given to a work group."

Staff writer Ed Ronco:
eronco@sbtinfo.com
(574) 235-6467

Employees told Briggs & Stratton will lay off more than 200 workers

By Jaime Baranyai - Staff Writer
Published: Monday, September 25, 2006 8:55 AM CDT
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The rumors are true -- more than 200 Briggs & Stratton employees will be laid off in November.

The layoffs are expected to affect roughly 215 employees on Nov. 28, 2006. Those who are laid off cannot expect to get their jobs back -- the layoffs are permanent.

Many employees who suspected the layoffs were coming are angry they weren’t told sooner.

“I’m angry. I’m angry and I’m very upset,” said an employee who wished to remain anonymous. “They knew this was coming and I’m upset they didn’t tell us before now.”

A letter to all employees states the layoff is a direct result of the seasonality of the business.

“We are feeling the effects of a lack of ‘storm’ related business reducing generator engine shipments, compounded by a lack of demand for snow thrower engines due to weather conditions this past winter,” the letter reads.

It goes on to say that lawn mower engine shipments are being affected by softer demand for lawn and garden equipment and efforts by retailers to maintain reasonable inventory levels in the distribution channels at the end of the selling season. It says this is consistent with industry forecasts that indicated shipments of mowing equipment by original equipment manufacturers would be down for the 2006 season.

An internal communication dated Sept. 19 states that because of this drop in demand, there is an ongoing study to determine the feasibility of building other products beside engines at the Rolla facility.

“This study will take several weeks to complete,” the communication states. “This does not mean the plant is closing. It could mean that building engines may or may not be in our long-range plan.”

But there are some employees who fear the plant will close within the next year, or even sooner.

“That’s still a rumor at this point, but there’s already a Briggs & Stratton plant in China and there’s another one being built in the Czech Republic,” said an employee who wished to remain anonymous. “Everything I know leads me to believe this plant will be closed by the next fiscal year, which begins July 1, 2007.”

The internal communication reveals the manufacture of horizontal cylinders at the Rolla plant could be moved to China.

“The product line could be going somewhere,” the document states. “Some could go to China and some to Auburn, Alabama.”

A 250,000 engine order has also been canceled, according to an employee who received notice he would be laid off in November. He added that Briggs & Stratton will no longer be product suppliers of Lowes and Wal-Mart stores.

“If this place shuts down, it’s going to kill the Rolla economy,” he said.

His advice to all employees at Briggs & Stratton, whether they’re facing a layoff in November or not, is to start looking for other jobs as soon as possible.

“Even if it’s not you in November, it could be you later on down the line,” he said. “I doubt the plant will be here very much longer. My advice is to start your job search. I’m going to start mine today at 3 o’clock when I get home.”

APC to layoff 330 workers globally, 65 in R.I.

This is in addition to 200 to 250 job cuts the West Kingston company announced in June and 66 unannounced job cuts made in Rhode Island. 01:00 AM EDT on Saturday, September 23, 2006
BY ANDREA L. STAPE
Journal Staff Writer

American Power Conversion Corp. plans to cut 330 employees worldwide, including 65 workers in Rhode Island, in the company's second major wave of job cuts this year.

In an attempt to trim operating costs, the West Kingston maker of technology equipment said yesterday it plans to reduce its 8,250-person global work force by about 4 percent, with cuts coming from locations across the globe and from marketing, sales, service, operations and other segments of the business.

Locally, the cuts add up to about 5 percent of the company's 1,300 Rhode Island workers.

In June, APC announced it was cutting 200 to 250 people in Ireland by the end of the year and was reconfiguring manufacturing there. In addition, the company also made 66 unannounced job cuts in Rhode Island in June. The planned jobs cuts announced yesterday will bring this year's total number of layoffs to about 7 percent of the company's work force.

"This is an extremely difficult decision to make, and one I do not take lightly," Rob Johnson, APC's president and chief executive officer, said in a statement yesterday. "But given the company's recent financial performance, it is essential to ensure our continued competitiveness in the market."

APC, which makes equipment that keeps computers running when the lights go out, expects to take $10 million to $12 million in charges for the cuts during the third and fourth quarters of this year.

The company anticipates $32 million in annual pre-tax savings from the layoffs, with $5 million in pre-tax savings during the fourth quarter of this year. It is also expecting to receive a $12-million tax credit, or 6 cents a share, during the third quarter.

APC's stock rose 10 cents yesterday to close at $21.40 a share.

The year has been difficult for APC. In the first quarter, the company's earnings fell 60 percent due in part to increased freight and shipping costs and higher prices for raw materials. In addition, APC increased its inventory by about $47.7 million to fill customer needs as it worked on ironing out distribution and supply issues.

The company has spent significantly over the past few years as it put more focus on selling equipment for the cooling and backing-up of computers in large corporate data centers. Sales and administrative costs rose 11 percent between 2004 and 2005 as the company invested in marketing the new products. But higher costs caused APC's net income to drop during the last three quarters and, during the second quarter of 2006, earnings were down 41 percent compared with the second quarter of 2005.

In August, Rodger Dowdell, the chief executive officer, retired and Johnson was put in place as interim CEO while the company searches for a full-time replacement.

Earlier this month, Matrix Asset Advisors -- which owns about 2.38 million shares of APC's stock -- called on the board to either sell the company or improve communications with shareholders and reassess its strategic direction.

After a year of slumping stock prices, the Matrix letter appears to have jolted investors, sending the company's stock up 26 percent this month.

Yesterday, David Katz, chief investment officer and cofounder of Matrix -- an investment firm -- said the job cuts were a step in the right direction.

"Clearly there is an enormous amount of additional work to do," he said. He said his firm would like more predictable earnings growth and better communications with shareholders.

"It's to the company's credit, during the period of an interim CEO, that they are running the business as efficiently as possible," said Katz.

Eric Landry, a stock analyst with Morningstar, said he hoped the cuts didn't indicate that the company was slowing its efforts to gain market share in the large-systems segment. He said that while investors over the past few years have not been willing to sacrifice short-term earnings growth, APC's investment in the new business area could eventually pay off.

"While it's nice to see short-term results, it's historically not how great wealth has been accumulated," said Landry. "The great investors have been the ones that have been able to look over the valley."

However, Landry said, APC's longer-term strategy remains "opaque" as it searchs for a new CEO. The company is still seeking a permanent top executive, said Debbie Hancock, a spokeswoman for APC. In the meantime, she said, the company is continuing to look at ways to revamp the business.

"We're looking at our business to continue to grow the business but to also drive productivity enhancements and reduce costs -- that's going to be an ongoing activity," said Hancock.

astape@projo.com/ (401) 277-7269

Unemployment dips slightly in August

East Bay Business Times - 12:47 PM PDT Thursday

California recorded the largest employment increase in the nation in August with 36,900 jobs gained.

The state's seasonally adjusted unemployment rate increased 1 percent in August over July, but decreased 0.3 percent compared with August of 2005, with 192,000 jobs gained in the past year.

The U.S. Department of Labor Bureau of Labor Statistics releases employment data monthly.

Among the states, California recorded the highest number of initial claims filed due to mass layoff events in August, 20,339.

Trammell Crow to lay off 64 in Bellevue

Seattle Times business staff

Trammell Crow said it is laying off 64 people in its Bellevue office between now and the end of the year as it cuts costs by combining three national accounting offices into two.

The Dallas-based real-estate company said it is shifting accounting work from Bellevue to Dallas and Memphis. One of 20 offices Trammell Crow has in the area, Bellevue will continue to offer project management, building management and brokerage services, with about 36 employees, said George Williams, area manager in Seattle. The company will have more than 280 employees in the area after the layoff, he said.

The cuts are unrelated to the real estate market, he said. Improved efficiency is the goal.

Trammell Crow last month granted cash bonuses of up to $5 million each to nine senior managers if the company hits profit targets in the second half of the year.

Ohio has nation's 5th highest unemployment claims in August

Business First of Columbus - 12:07 PM EDT Thursday

Mass layoffs in Ohio dropped slightly last month compared with 2005, but the state had the fifth highest number of initial unemployment claims in the nation.

The state had 23 large-scale layoff events of at least 50 workers in August, resulting in 3,772 initial claims for unemployment insurance, the U.S. Department of Labor's Bureau of Labor Statistics said Thursday.

In July, the state had 79 mass layoffs in July resulting in 10,108 initial claims. In August 2005, the bureau reported 26 mass layoffs resulting in 2,881 initial unemployment. The figures are seasonally adjusted.

California had the highest number of initial claims in August with 20,339 from 227 layoff events.

New York, Kentucky, Pennsylvania, California and Ohio had the highest number of initial claims filed accounting for 54 percent of all mass layoff events in the nation and 57 percent of all initial claims for unemployment insurance.

Nationally, mass layoffs rose slightly last month to 1,193 events, up from 1,125 in July and 1,145 in August 2005.

The bureau releases mass layoff statistics on a monthly and quarterly basis.

Ohio has nation's 5th highest unemployment claims in August

Business First of Columbus - 12:07 PM EDT Thursday

Mass layoffs in Ohio dropped slightly last month compared with 2005, but the state had the fifth highest number of initial unemployment claims in the nation.

The state had 23 large-scale layoff events of at least 50 workers in August, resulting in 3,772 initial claims for unemployment insurance, the U.S. Department of Labor's Bureau of Labor Statistics said Thursday.

In July, the state had 79 mass layoffs in July resulting in 10,108 initial claims. In August 2005, the bureau reported 26 mass layoffs resulting in 2,881 initial unemployment. The figures are seasonally adjusted.

California had the highest number of initial claims in August with 20,339 from 227 layoff events.

New York, Kentucky, Pennsylvania, California and Ohio had the highest number of initial claims filed accounting for 54 percent of all mass layoff events in the nation and 57 percent of all initial claims for unemployment insurance.

Nationally, mass layoffs rose slightly last month to 1,193 events, up from 1,125 in July and 1,145 in August 2005.

The bureau releases mass layoff statistics on a monthly and quarterly basis.

Superior Industries International

Superior Industries International Inc. said that it will close its plant in Johnson City, Tenn., laying off about 500 workers.

Detroit, Warren DCX plants to lay off 6,000

September 15, 2006

BY KATIE MERX
FREE PRESS BUSINESS WRITER

Nearly 6,000 UAW members who work at Chrysler Group plants in metro Detroit will be laid off temporarily.

Nearly 2,800 workers at Chrysler's Jefferson North Assembly Plant in Detroit will be laid off for at least four weeks beginning Saturday.

Union workers from the plant that manufactures the Jeep Grand Cherokee and Jeep Commander received layoff notices Thursday. The layoff will last at least through Oct. 19.

A Chrysler Group employee familiar with the layoff plans confirmed that work at the plant would stop after today for at least four weeks. Whether it lasts longer would depend on whether there is demand for more of the Jeeps made at the Conner Avenue plant.

The Chrysler employee also confirmed worker reports that all of the approximately 3,172 workers at Warren Truck on Mound Road would be laid off for two weeks. The Warren plant manufactures several variations of the Dodge Ram 1500, Dodge Dakota and Mitsubishi Raider.

Through unemployment pay from the government and wages and benefits from the company, laid-off UAW members are paid about 95% of their take-home pay, before taxes.

The layoffs come when Chrysler Group is cutting production of its profitable pickups and SUVs in hopes of avoiding the kind of sweeping restructuring under way at Ford and General Motors.

Phone company to cut nearly 400 jobs

Qwest has announced job cuts at its customer service, sales and collections areas in central Phoenix.
The layoffs include 360 workers.

A spokesman for the phone company says workers in sales and service will be laid off by mid-December and those working in the collections department will be terminated by the end of February.

The cutbacks will reduce Qwest's work force in the Valley by about eight-percent, to 48-hundred.

New York unemployment drops

New York state's unemployment rate dipped from 5.1 percent in July to 4.7 percent in August - matching the national rate, the state Labor Department said yesterday.

New York City's August rate was 5.1 percent, down from 5.7 in July and 5.6 in August 2005.

Mass layoff events increase in July

In July 2006, employers took 1,125 mass layoff actions, seasonally adjusted, as measured by new filings for unemployment insurance benefits during the month, the Bureau of Labor Statistics reported August 23rd. Each action involved at least 50 persons from a single establishment, and the number of workers involved totaled 114,895, on a seasonally adjusted basis. The number of layoff events increased by 28; the number of associated initial claims decreased by 4,767 from June 2006. In the manufacturing sector, 363 mass layoff events were reported during July 2006, seasonally adjusted, resulting in 47,287 initial claims. Both the number of events and initial claims in manufacturing were higher than a month earlier.

Ford Motor

Norfolk Ford workers resigned to fate
With plant furloughs this year, some already think of it in the past

BY JOHN REID BLACKWELL
TIMES-DISPATCH STAFF WRITER

Sep 9, 2006

NORFOLK -- On the eve of a five-week layoff at Ford Motor Co.'s Norfolk F-150 plant, several employees spoke yesterday as if they were already working their final days.

"I wish Ford the best," said Ray Rollman, an electrician at the plant for 18 years. He and his two sons, who also work at the plant, want to start an electrical contracting business eventually, but it could be sooner than they think.

Ford announced in April that it would close the 81-year-old plant in 2008 as part of a restructuring plan to get its North American operations back to profitability.

Last month, the struggling automaker said the Norfolk plant, which employs 2,400 people, will shut down for nine weeks between Sept. 11 and Dec. 22. That started with the five-week layoff after yesterday's final shift.

Union members get 83 percent of their normal pay during manufacturer-imposed furloughs.

The additional downtime this year, including a week in August, has raised concerns that Ford might close the plant before 2008.

"Everyone thought this place was going to stay open forever," Rollman said. "I guess morale is at an all-time low."

Jerome Perry landed a job at the plant four years ago and thought he would spend the rest of his career working there.

"I thought I might retire from here, but it doesn't look like that is going to happen now," said Perry, an equipment operator who stopped by the union hall yesterday to get the work schedule for the next three months.

"Once they shut down today, this schedule means nothing," said Perry, who added that he is seriously considering taking another job offer.

Some workers are hoping for buyout offers from the company, Perry said. "I don't mind working here, but they need to tell me if I'm going to get something. I've got to think about my future."

Joe Stone, a 29-year employee, also expects an "announcement of buyouts or something. I don't see it going past the end of the year. We've had a good run with this plant."

The employees said they do not expect a reprieve with the company's change in leadership. This week, Bill Ford, the great-grandson of founder Henry Ford, resigned as the company's chief executive officer but remained as chairman. He was replaced as CEO by Alan Mulally, a former Boeing Co. executive credited with leading that company's turnaround in recent years.

Chris Kimmons, president of the United Auto Workers Local 919, said yesterday that the new CEO "has a good head on his shoulders. Hopefully, this guy will be an asset for the company. We'll just have to wait and see."

Ford, which plans to close 14 plants by 2012, is restructuring itself to match factories and workers to its reduced market share.

Kimmons said he is trying to remain optimistic about the plant.

"But every bit of news we have gotten from Ford has been bad news," he said. "I don't think it is going to turn the other way. I hope I am wrong."

Contact staff writer John Reid Blackwell at jblackwell@timesdispatch.com or (804) 775-8123.

Eljer to layoff 200 in coming year

By Mitch Fryer
LEADER TIMES
Wednesday, September 6, 2006

FORD CITY -- Eljer Manufacturing said Tuesday that about 200 workers will be laid off at its Ford City plant within the next year due to the outsourcing of jobs.

Those jobs will end up in Mexico, China or South America, officials said.

Eljer plant manager and vice president of operations Jim Kutsch said negotiations are under way in an effort to produce most of the company's plumbing products outside of the United States.

As a result, employment will be reduced at the Ford City plant from 266 to about 60 to 70 production workers, and from 310 to about 100 total jobs in the plant.

"This is difficult for all of us and a devastating blow to the community," Kutsch said. "It comes down to a global economic market. I don't know what we could have done to prevent this."

Kutch said he did not expect the layoffs to begin for several months. Currently no workers are laid off, he said.

"The company's goal is to complete the outsourcing by Sept. 1, 2007," Kutsch said. "As we go along and get more outsourced, we will scale back here."

"It could happen sooner or later, but it will probably take a year," he said.

The primary function at the Ford City plant will be to supply the market for colored plumbingware products.

The Schenley distribution center in Gilpin Township will continue to operate.

"If we sell it in white, silk or natural, we will be outsourcing it," Kutsch said. "We are very good at producing colors here in Ford City."

On Friday, the company informed members of Local 158 of the United Steelworkers of America of its decision.

"Everyone is upset," said local union president Duke Zellefrow. "It will affect people with 30 years of employment.

"It was unexpected. We helped every way we could."

Zellefrow said the move leaves no incentive-earning jobs in the plant.

"There won't be enough product here for that," Zellefrow said. "They took away everything we could make a dollar on."

Zellefrow said the next step is to bargain for a severance package for its laid-off workers.

The layoffs will be made according to the contract agreement. However, the terms are negotiable with the union.

"I assume that it would be based on seniority," Kutsch said. "It could be by job classification, but I'm not saying that's what it would be."

Mitch Fryer can be reached at mfryer@tribweb.com or (724) 543-1303 ext 242.

Layoff announcements bounce back in August

Challenger: Job reduction plans down 24% year-to-date

By Rex Nutting, MarketWatch

Last Update: 4:34 PM ET Sep 5, 2006

WASHINGTON (MarketWatch) -- Announcements of job reductions at major U.S. employers rose by 76% in August, bouncing back to the average level for the year, according to an unscientific monthly survey conducted by Challenger Gray & Christmas released Tuesday.

Job-cut announcements rose to 65,278 in August from a six-year low of 37,178 in July, "in what may signal an early start to year-end downsizing," Challenger said. Announcements totaled
67,176 in June and have averaged 67,375 this year.

The figures are not seasonally adjusted. Layoff announcements typically fall in the summer months when bosses go on vacation.

The report does "not point to a weakening in the labor market," said John Ryding, chief U.S. economist for Bear Stearns.

The report comes four days after the Labor Department reported that nonfarm payrolls grew by 128,000 in August, while the unemployment rate ticked lower to 4.7%. Government data show a softer pace of hiring in the past five months, while first-time claims for jobless benefits have ticked slightly higher in recent weeks.

So far in 2006, employers have announced 538,914 job cuts, 24% percent fewer than this time last year, Challenger said. Annual job cuts are on pace to finish below 1 million for the first time since 2000.

In August, computer companies led the way with 17,371 job cuts. The auto industry announced 7,639 reductions, bringing the annual total to 77,897.

The woes in the computer industry continued in Septmber. Chip giant Intel announced Tuesday it would eliminate 10,500 jobs, about 10% of its workforce. See full story.

"There are some signs that the housing slowdown is taking a toll on jobs," said the firm's CEO, John Challenger. "Job cutting in real estate this year is nearly double last year's pace." But job cutting in other housing-related sectors, such as finance or consumer durable goods, has not risen, he said.

"The housing slowdown has not had a major impact on the job market, yet," said Challenger.

The Challenger report covers only a tiny fraction of those who lose their jobs each month.

In June, for instance, a total of 1.51 million workers were discharged from their jobs involuntarily, according to the latest data from the Labor Department.

The layoff announcements tracked by Challenger could take place immediately or over time.

The reductions could be accomplished by voluntary means such as retirements or workers leaving for other jobs. They could be offset by hiring in other divisions of a company.

Rex Nutting is Washington bureau chief of MarketWatch.