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's picture
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's picture
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's picture
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...

Yellow Snow

Thanks, Sam, for your comforting words.
The cost of wages/benefits has always been built into the price of products and services. Both your job and mine. The larger impact has been having to absorb unemployed and uninsured. And we know where that has gone for quite a few years now. Both your taxes and mine, both your purchases and mine, fund those who aren't working and don't have insurance. In a lot of ways it all goes full circle.

8ballinthesidepocket

While I extend sympathies to you on the passing of your husband, but the cost of your insurance through the union contract is passed on to everybody that buys a car. Who do you think paid for it? The union? That's a joke. The legacy costs are what buried the auto industry, and your life insurance and health insurance and pension are part of the legacy costs. Not your fault, but don't think we don't pay for it and pay for it and pay for it and will continue to pay for it until all the covered retirees are gone.

pavedparadise

@Darkhorse

You must still be thinking back to the 1980s

Here is some Forbes information for you from 2008. Additional concessions in 2009.

12/05/2008 @ 6:00AM If GM Collapses, Don't Blame The Union
Unionized autoworkers are a favorite scapegoat for the problems facing U.S. automakers. Their job security guarantees and gold-plated benefits have surely cost General Motors , Ford Motor and Chrysler a bundle over the past few decades. Indeed, the domestics’ historically high labor costs are among the reasons they haven’t been able to compete with Japanese rivals, and why Detroit CEOs were back on Capitol Hill again Thursday asking for $34 billion in taxpayer loans to survive.

But the U.S. automakers probably would have collapsed by now if not for the concessions made by the United Auto Workers union over the past three years.

Once bitter enemies, the Detroit Three and the UAW have long since buried the hatchet and are now working together to close the wage gap with Toyota , Nissan and Honda through various productivity improvements and more flexible work rules, for instance.

The union has made some major concessions. Two biggies last year: The UAW agreed to cap the cost of retiree health care through creation of an independent trust fund and agreed to cut wages in half, to $14 an hour, for new hires in non-assembly jobs (20% of the workforce). More concessions came this week when the union agreed to end a controversial “jobs bank” program, which pays workers even when there are no vehicles to build. The union also said it would allow car makers to extend their scheduled payments to the health care trust fund. Importantly, UAW President Ronald Gettelfinger also said the union is ready to renegotiate additional contract terms.

Contango

Re: "Once bitter enemies, the Detroit Three and the UAW have long since buried the hatchet,"

TOO LITTLE, TOO LATE.

bucknut36

Ford Motor Co is posting record sales. The average Ford UAW worker received an $8,000.00 PROFIT SHARING check. The Union doesn't seem to be hurting Ford one bit!!

Contango

Re: "The Union doesn't seem to be hurting Ford one bit!!"

An anomaly.

Meanwhile, the City of Detroit is defaulting on it's outstanding debt and paying 10 cents on the dollar.

http://www.reuters.com/article/2...

What the unions and Democratic leadership did for Detroit, it can CERTAINLY do for the entire U.S.

pavedparadise

How in the world can you associate Detroit's poor government leadership and the auto industry with the downfall of the City of Detroit?

Contango

Re: "auto industry"

Read it AGAIN. I WROTE: "UNIONS." THAT includes BOTH public & private.

SamAdams

It should also be noted that Ford is the ONLY major automotive manufacturer that declined to participate in Barry's Bailout...

bucknut36

Bush gave GM and Chrysler the first bailout!!!

8ballinthesidepocket

You need to dig a little deeper my friend. Do you know what the union content or cost per vehicle is at Ford? Less than 15% which is one third of what it used to be. Between outsourcing, two tier wages systems, robotics and other manufacturing process improvements, the UAW's role at Ford is much reduced and those reductions will continue. Just like weeding a garden. Notice, Ford, unlike Govt Motors and Crysler, didn't go running to Obama for a bailout. GM still owes the taxpayers $30 billion in terms of the stock we taxpayers still own.

pptrsha

I remember standing in jarmin field behind our house watching carter get out of a helicopter waving and smiling, all of us holding signs that read "re-elect carter the best president panama ever had!" generations of americans lost their jobs and homes when carter signed over the canal zone. American jobs have been disappearing for a long time and not just on our soil.

R U Kidding me

If you are at the point of relying on politicians to help save something you have hit rock bottom take your loses and move on.

AJ Oliver

U.S. corporate taxes are very low - due to big loopholes.
Panama Treaty had nothing to do with US jobs.
What we have going on is a concerted assault on the middle and working classes - the one percenters are laughing because they have turned us against each other.
NAFTA, FTAA & other trade deals are made at our expense. US workers have to compete with Mexican, Chinese and other workers who are forced to work at the point of a gun - and our govt often even supplies the guns. Watch out for that new Asia trade deal - it's really dangerous - being written in secret by corporate lobbyists.

Contango

Re: "U.S. corporate taxes are very low - due to big loopholes."

Highest marginal corp. tax rate IN THE WORLD.

Corps spend BILLIONS of dollars in attorney and accountant fees to comb through the byzantine U.S. tax code in order to secure the lowest real tax rate - waste of $.

Excessive regulation and tax compliance cost the U.S. economy trillions annually in lost productivity (GDP).

Expensive d*mn "loopholes."

The Big Dog's back

Same old worn out slogans. Even a lot on the right realize taxes and regulations haven't hurt Big Corporations one bit. Time for you to bet on another horse.

Contango

^^^ "bullspit."

Contango

Re: "US workers have to compete with Mexican, Chinese and other workers who are forced to work at the point of a gun,"

Not to worry, our central bank (Federal Resv) is hurtin' 'em good!

"It has been widely noted that the U.S. stock market has moved up in tandem with the expansion of the Fed's balance sheet, with new highs being set in May as the central bank bought Treasury and agency mortgage-backed securities at a $1 trillion annual rate."

" ALL OF WHICH HAS CREATED a great, sucking sound out of emerging markets, evidenced by the declines in their stocks, bonds, and currencies."

http://online.barrons.com/articl...

The Big Dog's back

You just contradicted your previous paragraph.

Contango

^^^ “Still don't know what that means yet huh?” - The Big Dog's back, 5/27/13 :-7

Fromthe419

I'm not sure I agree with corporate taxes being low, but I agree with your comment:

Watch out for that new Asia trade deal - it's really dangerous - being written in secret by corporate lobbyists.

It reminds me of the formation of the Federal Reserve, Congress did not write the Federal Reserve Act of 1913, the bankers did and look where this has got us. If you have not read The Creature from Jekyll Island, I suggest you do, it tells the dirty little secret the banks don't want you to know.

pptrsha

so all of the americans working in the canal zone who lost their jobs and had to leave to find work don't exist?

fifteenthgreen

Make sure you vote Yes for that new school levy! Oh sorry, Permanent Improvement Levy!

OMG.LOL.WT_

I knew my previous post would raise some hackles. I didn't say the democrats were any better. The whole government is controlled by the corporations. I agree with AJ

Contango

Re: "The whole government is controlled by the corporations."

More like the converse: Corps are govt. controlled, i.e. fascism or crony capitalism.

Ya might wanna read some business news and read how govt. agencies, i.e. EPA, SEC, et al. are fining and suing corps. to the tune of billions of dollars annually.

Why would the corps be suing themselves?

The Big Dog's back

Bullspit.

Contango

Re: "Bullspit."

“Same old worn out slogans.” - The Big Dog's back, 6/16/13 :-7

queenjhb

Will learning to speak Chinese help us out?

bored reader

If speaking Chinese doesn't help, perhaps declaring yourself to be a muslim/islamic extremist would be beneficial. They seem to be getting their way in the US>

grandmasgirl

As long as American's go to Wal-Mart to buy products made in China, we will never recover. It is very hard to look and look for products made in the USA, but that is what we need to do. Even some of our food is coming from foreign countries. I can see bananas and such, but come on,,,we can grow most of our own fruits and vegetables, along with our meats.

KURTje

AJOliver winner. Winnie loser.

Fromthe419

Actually they are both right, the US does have the highest corporate tax rate in the world at 35% but lobbyists have gotten rules written into the tax code that allow those that are in favor with whichever administration is in place (insert D or R) that allows them to pay a much lower tax rate while those not in favor with whatever party is in power pays a much higher rate. Explain how GE (Jeffrey Robert Immelt, Obama Job Czar and GE CEO) earned 14.2 billion world wide in 2011 and paid ZERO in taxes? And there are examples of the same occurring to Bush allies as well. Political allies always benefit when "their guy" is in office.

Contango

Re: "paid ZERO in taxes,"

The highest marginal tax rate for corps should be 0%.

Example: Dividends are taxed TWICE. Once at corp level THEN again at the individual level.

In fact, corp. taxes are pass-throughs and added to their product or service costs.

The end user ULTIMATELY pays the taxes.

Why do you think the not-for-profits are the one of the fastest growing segments of our economy?

Corp. taxes promote financial malinvestments in our economy.

The Big Dog's back

Double bullspit.

Contango

^^^ "Double bullspit." :-7

2cents's picture
2cents

I have been non profit for a few years now, still pay 52% income tax to the IRS and the checks seem to get cashed. LMAO, rethinking windmill factory, or maybe design and patent the newest and best PMM!

Contango

@ 2cents:

I worked for NFPs. We had a saying:

We're NFP, but we're not for loss either.

Saw where Siemen's is pulling the plug on their solar project:

http://www.bloomberg.com/news/20...

Good luck with the PMM! :)

TANSTAAFL.

lifetimeresident

It seems from these post that alot of you have taken big decreases in pay to keep a job. But you still have a job. Thats a good thing. Wish you were making more but at least you have a job. My biggest question would be " How come the schools want more tax money from you". Do they not know you took a wage cut to keep a job. Why dont they try that approach?

Yellow Snow

Automotive workers were/are probably the largest contributors to taxes. As we've lost this base, all schools need to face this fact. Seems like everyone wants to complain about what automotive workers make. We've all made concessions, we've all learned to do with less. It's a beautiful thing to see your kids have the best for 12 years in school, but we've all had to minimalize. Support your local workers.

TboneWalkerJr

SUPPORT LOCAL UNION SCUM WITH TOUGH LOVE

They need to be FORCED to go out and find other jobs without UNION EXTORTION.

Typical UNION SCUM complaint:

"WHERE ELSE AM I GOING TO FIND A JOB PAYING $30 AN HOUR, get paid for 8 hours, but only work 7, doing a job that somebody from LOTT INDUSTRIES could do it is so simple"

HILARIOUS how the UNION SCUM whine about not being able to find a job anywhere else paying the EXORBITANT WAGES THEY GET thanks to UAW EXTORTION of the company through WORK STOPPAGES, WORK SLOWDOWNS, VANDALISM, SABOTAGE, and of course VIOLENT CRIMES AGAINST management and "SCABS"

IF THEIR "SKILLS" are only worth $20-30/hour when the UNION is extorting the company then THEY ARE NOT WORTH WHAT THEY ARE MAKING

If these UNION SCUM have such valuable skills, other companies should be FIGHTING TO GET THEM

Contango

Re: "Thanks to his union contract, I will have good health insurance for the rest of my life."

Gotta ask: Where do you think that the assets which fund that health insurance and any retirement pay outs are invested in order to help provide those benefits?

WhatTheHeck

These retirement benefits were to be funded by the company in lieu of a higher hourly wage. That money was to be invested and protected 100%. The government decided to allow corporations to use up to 30% of the accumulated funds to support and grow their business. The companies seldom repayed the funds.

Kimo

Like my Dad told me in 1956: "If Americans keep buying imported products they will buy themselves right out of a job". "They won't even be able to buy imported products without a job".

You can't put all the blame on unions. The job losses in the RTW states down south were caused by greed.

The Sam Walton business model is the norm today.......

We went from "Union Brothers" to "Associates"......
.

Kimo

As long as other countries are allowed to dump and we have a trade imbalance, America will be at the mercy of the governments that control our economy.

end of story....

Kimo

We will however have large debates about "public records" and "police reports".

While we "debate", the Japanese and Chinese will keep using the profits from America's trade imbalance to buy up more of this country.

Contango

@ Kimo:

Good to read that in your mind that unionism and protectionism will solve ALL the economic problems of the U.S.

History tells a different story.

The Big Dog's back

Capitalism has failed.

2cents's picture
2cents

Decossackization, I guess my grandfather picked another wrong place to move to then :(

Fromthe419

Do you have an alternative? If so, please elaborate.

Contango

^^^ “bullspit.” - The Big Dog's back, 6/16/13 :-7

KURTje

Kimo wins. Then there is also ran. Thirdary description on Webster's.

whocares

I will buy an American made car when the parts in it come from America. The last American made car I purchased was 35% made here. A Honda Accord is 75% made in America. Why can't the big three do that?

TboneWalkerJr

Toyota Corolla is currently the HIGHEST US COMPONENTS PERCENTAGE

The "American" car with the LOWEST % AMERICAN COMPONENTS?

FORD FOCUS which is ZERO % AMERICAN

Contango

Current and former private AND public union employees shouldn't get too comfortable regarding their "guaranteed" "lifetime" health and welfare benefits.

"A plan to cut pension benefits previously thought sacrosanct for 30,000 workers and retirees may tip Detroit into bankruptcy as Emergency Manager Kevyn Orr negotiates over $17 billion in debt and obligations."

States like IL and CA are also in DEEP funding trouble.

http://www.bloomberg.com/news/20...

Why isn't Pres. Obama RUSHING to his union allies aid????

TboneWalkerJr

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