Wage battle to save bearings factory

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Jun 15, 2013

Excerpt: If there is an effort to save the KBI bearings plant from being driven out of business, then it's a quiet gathering working below the radar. We're not sure a strategy without publicity can work and we're troubled by concerns workers and  retired employees of the former New Departure factory shared after a labor contract was signed earlier this month. They said they feared this contract could be the last one at the factory that for generations was the No. 1 employer in the region. 

The auto industry dominated the local economy for six decades, but as the plant at Perkins and Hayes avenues potentially winds down, with wages now considerably lower than in years past and a work force considerably diminished in number, there is no fanfare and no effort we can discern to save it from extinction. 

New Departure was a General Motors property before it was Delphi and before it was KBI, but it's fate was perhaps sealed when GM shed it and the previous contracts and Delphi bankruptcy hog-tied its future. 

Plant workers clock-in and clock-out every day without any job security  It appears now the clock might be ticking away to the final days for KBI workers and their families. The employees and retirees said they fear  the new contract — which primarily extends the wage agreements forged in courts over the years — will be the last one. The contact expires Sept. 14, 2015.  

We'd like to see a coalition of leaders — including U.S. senators Sherrod Brown and Rob Portman and U.S. Rep. Marcy Kaptur — develop a strategy to wage a very public campaign to preserve this factory. That same team might also examine what needs to be done to secure a long-term agreement to keep Ventra Sandusky, the former Ford plant on Tiffin Avenue. 

The jobs at KBI and Ventra are important to our local economy. Losing one or either of these factories will be a major blow to our communities and school districts, and it would create a hole in the economy and a void in opportunities and the way life has been lived in this area for more than 60 years. 

This is a battle that should be waged.

Comments

Yellow Snow

While so many were envious over the years of wages/benefits, no one can deny the huge financial impact this once great company had on this area. Let us support the remaining workers, as they too contribute to our area. This too, could become a major tax base loss, as well as a huge building that will most likely end up as American Crayon has.

Contango

Re: "American Crayon"

Several decades ago I worked a couple summers at AC. The building was a dump then with rotten wooden floor that the wheels of a forklift would occasionally fall through.

SamAdams

I agree that the jobs are important — VERY important! — to the local community. But businesses are in business for one reason and one reason only: to make money.

If there's a way that the factories can continue to be profitable, then sure, wage the battle to prevent the manufacturing from being moved out of the area. But if they're engaged in a process that's not being downsized but rather phased out, or if they're losing money, then why on earth would any business continue to throw cash into a sinkhole?

No, I don't know whether or not the factories are still up to date, or if they're cost-effectively making things that remain in demand. But I suspect that if the answers to those questions was positive, nobody would be worried about either facility going away! What we CAN'T do, no matter the good intentions, is insist on some sort of another government bailout. That's like giving a blood transfusion to a dead body. It might make YOU feel better and as if you're doing something constructive, but it doesn't bring anybody back to life, and it sure as heck isn't good for the donor!

One thing I WOULD point out is that corporate taxes are higher in this country than practically anywhere else in the world. Want businesses to stay in this country and to thrive? Stop forcing them to fund a seriously bloated government!

eriemom

I have first hand knowledge that the Ford plant was highly profitable when they spun it off to become Visteon.

pavedparadise

So was KBI and still is. Problem is GM wants to buy the bearings cheaper and poorer quality.

Contango

Re: "cheaper and poorer quality"

How do higher labor and production costs equate to better quality?

8ballinthesidepocket

You got that right. They may be cheaper, but their quality is equal to or better than what was produced by the UAW at that plant.

8ballinthesidepocket

Eriemom: The plant was never profitable in the true sense of the word. It the world of corporate accounting, the indicated profit for the Sandusky plant disappeared when the plant was allocated the proper amount of corporate overhead, so by the time the Sandusky plant's product ended up on a car, there was no profit. They looked profitable because their cost base was a standard cost they made up themselves and compared to that cost and not competitive bids, they were "profitable." If you really think they were profitable, why did Ford spin them off??? If you saw a fully allocated income statement that included corporate overhead and legacy costs include, I guarantee it would not and did not show a profit!!

2cents

http://www.bls.gov/fls/china.htm

It's not just the US, I was in a small Canadian plant last week, the owner let go of 60 of his 65 people when Ford and Fram moved their fuel filter production to China that he was producing.

Contango

Re: "...moved their fuel filter production to China,"

Increasingly, the differences in labor and production costs between the U.S. and China is narrowing.

I recently read where Canada's labor costs are higher than the U.S.

Regardless, with the increased use of robotics, fewer workers are needed than even 10-20 yrs. ago.

http://online.wsj.com/article/SB...

2cents

I agree, I said many, many years ago that robots building cars, washing machines and other items will never have the need to use them. Outsourcing for lower labor costs and basic greed among all people have reduced the need of many products.

You can have all the low cost widgets in the world on a store shelf but unfortunately if the people looking at them did not help build them, they may not have a job or the funds to buy them!

Contango

Re: "They may not have a job or the funds to buy them!"

That's where govt. transfer of payments comes in.

Prior to GM goin' bankrupt, GMAC (now govt. owned Ally) was financing auto purchases. GM was basically a finance co. that offered sub-prime loans for consumers to purchase their vehicles.

Both GM and Chrysler are AGAIN making sub-prime loans in order to push product.

As long as Uncle Ben can crank out the currency, and nothing blows up financially we 'should' be OK.

The U.S. has become one big (bleepin') Ponzi scheme. Economic fundamentals have been TOTALLY skewed.

Like the old Soviet Union:

They pretend to pay us and we pretend to work.

2cents

Did you notice what I placed in my post on (Privacy) this morning?
"ISBN 1931859256"

Contango

Yep! Marx and Engles dystopian classic.

Fromthe419

It's very sad to see this happening, my great-grandfather, grandfather, two uncles and an aunt worked there. Heck, I would be living here if not for my great-grandfather moving here from Cleveland seeking work at the plant. The American dream of graduating from high school and getting a factory job, working for 30 or 40 years and retiring with a pension are over, globalization has changed the ball game. The only way manufacturing jobs are going to come back is if our Fed can devalue our currency to the point that it is cost effective to bring them back and if that occurs they would not be a desirable job. Let's face, what is a good paying manufacturing job in this area now? 10 bucks to 15 bucks an hour? That's the same as it was 10 years ago and with inflation, that's about minimum wage.

KURTje

Bring the Koch brothers. They care.....about self.

OMG.LOL.WT_

No republican gives a darn about this. It is a natural result of their union busting (Ronnie broke the air traffic controllers) and "free" trade policies.

Contango

Re: "No republican gives a darn about this."

Would the converse of that be:

Every Democrat wants to push labor and production costs as high as possible in order to kill manufacturing in the U.S. and in the process impoverish the country?

Why are RTW states like TX doin' so much better economically than heavily unionized states like IL?

Gov. Perry is in NY and CT tellin' 'em to 'come on down!"

The Big Dog's back

BTW winnie, bullspit.

Contango

^^^ "bullspit." :-7

Fromthe419

You really think Dems care about workers? Jimmy Carter deregulated the trucking industry in 1980 and 300,000 Teamster jobs were lost and let's not forget Bill Clinton signing NAFTA. Remember both sides were laughing at Ross Perot when he said "there will be a huge sucking sound" of our jobs heading south of the border. How many good paying jobs are now being done in Mexico and China, like I said those WERE good jobs, but they aren't coming back. Central Banks around the world are trying to devalue their currencies to boost exports, the end result is not good for you and me.

JudgeMeNot

Kool-aid drinking Dems do care.

The Big Dog's back

You're right 419. Carter did deregulate the trucking industry. And Billie (I just want to get along" Clinton did sign NAFTA. But the guy hurt American workers the most was Ronny Raygun. He's the one who turned Big Business loose. Consolidations, Leverage buyouts, etc.

JudgeMeNot

Let the people decide.

bobshumway92

The place smells like a giant fart.

Darkhorse

The unions did it to themselves and now the companies may be closing down because the unions asked for the world or we go out to strike attitude. We are paying way too much for cars and it is not sustainable.

Yellow Snow

I lost my husband one week ago. Thanks to his union contract, I will have good health insurance for the rest of my life. It won't cost you or any one else a dime. Yes, we did this to ourself, we protected ourself from depending on handouts from you and other taxpayers. The cost of your vehicle is much cheaper that the cost to maintain my health. Should I eventually end up in a nursing home, our life savings will be eaten up, then you will have to pay for me. Around $5000 per month locally. Should I pass before then it will cost YOU nothing.

Contango

Re: "Around $5000 per month locally."

Add about another $1K or more monthly to that number.

"The national average daily rate for a private room in a nursing home is $248, while a semi-private room is $222 up from $239 and $214 respectively in 2011."

95% of the cost of nursing home attendees care is paid for by Medicaid, since most are without assets.

Wait until the filial laws kick in and the State charges children for their parents' care.

OH has filial laws on the books.

https://www.metlife.com/mmi/rese...

pptrsha

snow, I am sorry for your loss

SamAdams

I am sorry for your loss. No matter the provisions left behind, nothing makes such a loss simple or temporary. I wish you strength until the time your memories make you smile rather than cry.

I would ask you, though, how you could believe that your health insurance "won't cost you or anyone else a dime." Are there no premiums? Or does somebody pay those premiums? Who is that somebody that's paying the premiums? The company? Then ALL of us are paying for it with the cost of higher-priced goods and services.

Please remember that one of the biggest factors in some major bankruptcies (including at least one state on the brink right now) are the result of unsustainable pensions and benefits to too many retirees! Yes, the unions got their membership one heck of a deal. Too bad they simultaneously killed the goose that layed the golden eggs...

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