*

Tuesday, December 29, 2009

Not to worry. No jobs are in danger.


Are the multitude of factory closings across the width and breath of North America really a necessary part of a healthy capitalist system? Or has something gone wrong? Has our system jumped the rails?

It snowed last night, as it has done in the past and will do again in the future. A Champion grader cleared the snow as it has done in the past, but its days are numbered.

The Champion plant in Goderich, Ontario, a beautiful little town just over an hour north of London, was acquired by the Volvo Construction Equipment Group in 1997. Volvo CE closed the plant this past June.

According to the Champion Antique Grader Club:
"For nearly 125 years, Champion graders built and maintained roads around the world. In 1875 Champion built the first horse-drawn grader. Since then, the innovations have been revolutionary within the grader industry.

The first self-propelled grader and, later, the first all-hydraulic grader, was a Champion . . . Champion motor graders were shipped to 97 countries."
As Champion Road Machinery Ltd. the company lasted 122 years. Under Volvo the plant was boarded up, closed, in a dozen. Why?

It was 1997 when then President and Chief Executive Officer, Art Church, announced the sale of Champion. He said, the sale would allow the company to tap into an international network of sales, distribution, advanced technology, research and development.

The new owner, Volvo CE, would continue to manufacture road-building equipment under the Champion name in the community of Goderich.  But, not to worry. No jobs are in danger, he assured the workers.

Some of the manufacturing of its road-building equipment was soon moved to Brazil.

In 2004 Volvo CE sold the compact motor grader business to Champion LLC in Charlotte, North Carolina, a company organized by Gary Abernathy. Abernathy had been manager of the Goderich business under its previous owner and had continued in that position after the sale. The Charlotte, NC, company acquired the compact motor grader product line and after July 1, 2004, they were to carry the Champion name. (Abernathy kindly posted some pictures of the old plant. Follow the link.)

Today Gary Abernathy is President of Champion LLC in Charlotte and Bryan Abernathy is executive vice president. If you go to their site you will read their story: "Champion built the first horse-drawn grader in 1875 and later the first motor-driven grader." They like to say, "Today, Champion Motor Graders has returned to its roots as a family-owned business . . . " Read Bryan Abernathy's comment below to understand why an NC company makes this claim and backs it up.
__________________________________________________

I am a blogger and not a paid journalist. I do this for pleasure and not profit. (But, please don't let this stop you from clicking on an interesting ad. I do get a penny or two.)

I received this comment and I think it is important to slide it into my post and not to simply bury it as a comment that may go unread. I may be blogging now and not working at a paper, but I do strive for accuracy and fairness.
Bryan Abernathy said... 
 
“Quite an interesting piece and a good chunk of Goderich history … I would like to clarify one aspect of the Champion history in Charlotte NC. The compact grader line was originally founded in Charlotte by the Lee/Abernathy family in 1980. Gary Abernathy actually designed and hand built the first unit. The brand from 1980 to 1993 was "Lee". (not to be confused with LeeBoy) Champion, in Goderich, purchased the Abernathy business to expand the Champion product line, with Gary Abernathy continuing to manage the compact grader operations. The original Champion ceased being a family business when it was sold by the Sully family in 1988. When Volvo took over Champion in 1997, it acquired the compact graders business as part of the package. Eventually, Volvo decided to divest the compact line and sold it back the Abernathys. By then, Volvo had dropped the Champion name, but Gary and his people were very proud of their connection to the Champion legacy and the town of Goderich. They bought back the Champion name from Volvo as part of the deal. So, as the new Champion website states, the Charlotte grader factory actually did return to its “roots” as the Abernathy family business, operating again under the Champion banner since 2004.”
__________________________________________________

Despite the loss of the Champion name, the Goderich workers were assured by Volvo product and communications manager Brian Lowe that the sale would not affect the Goderich employees in any way. Not to worry. "No jobs are in danger," he reportedly promised.

And for awhile it looked as if the promises were true. In 2006 the Goderich plant produced the new G900 series motor grader. Volvo Motor Graders Ltd. President and CEO, Patrick Olney, believed the company had completed the most significant product development in the history of the plant.

Construction Equipment Magazine recognized the G900 series as one of its Top 100 New Products of the Year. This was the second time for the Goderich plant to be so honoured; In 2002 they were honoured for the G700B Series Grader.

The political leaders in Goderich at the time thought Volvo CE, "commendable." I wonder what they think today?

Fast forward to December 2009. According to the Goderich Signal-Star:
"With little fanfare and December lake-effect flurries whipping across the parking lot, two Volvo G960 motor graders were loaded onto TTK Transport Inc. flatbeds and rolled out of town Tuesday, Dec. 15 . . .
Sadly, it represented the last time that road graders would be seen leaving the town limits of Goderich. The final two graders were on their way to Egypt.
With many of the industrial park buildings now vacated, or sold, the company is winding down its operation in Goderich and General Manager Alan Ball said, 'We are going into the final phase of our existence here and the bulk of the materials and equipment from the plants is gone.'
Last week the company announced it will close its Asheville, North Carolina facility, a move that will affect 228 employees. The production from Asheville will be moved to other existing Volvo CE locations.
The cab production from Asheville will move to Shippensburg, while production of wheel loaders will move to Arvika, Sweden and excavators will be produced in South Korea."
Patrick Olney, Executive VP, Global Operations, said after the sacrificing of hundreds of Asheville jobs on the alter of profitability, “Although the decision was necessary from a business standpoint, we fully understand that the affected employees – who in the current downturn are already going through challenging times – will face additional difficulties.”

The workers in Shippensburg, Pennsylvania, are being assured that this decision will have no impact on the ongoing significant investments in Shippensburg. Not to worry. No jobs are in danger.
__________________________________________________

Addendum:

Although a downturn in the construction equipment market resulted in 94 Shippensburg workers being laid off shortly before the original story was posted, for workers in Pennsylvania this story has a happy ending.

As of mid 2012 a $100 million U.S. expansion of the Penn plant is underway. The customer-demonstration center in North Carolina was being closed and moved to Shippensburg. If all goes according to plan, Volvo’s Americas operations will be consolidated in Shippensburg.

As for Goderich, Ontario, there is no happy ending there. Jobs were lost and those jobs will never return.

1 comment:

  1. “Quite an interesting piece and a good chunk of Goderich history … I would like to clarify one aspect of the Champion history in Charlotte NC.

    The compact grader line was originally founded in Charlotte by the Lee/Abernathy family in 1980. Gary Abernathy actually designed and hand built the first unit. The brand from 1980 to 1993 was "Lee". (not to be confused with LeeBoy) Champion, in Goderich, purchased the Abernathy business to expand the Champion product line, with Gary Abernathy continuing to manage the compact grader operations. The original Champion ceased being a family business when it was sold by the Sully family in 1988. When Volvo took over Champion in 1997, it acquired the compact graders business as part of the package. Eventually, Volvo decided to divest the compact line and sold it back the Abernathys. By then, Volvo had dropped the Champion name, but Gary and his people were very proud of their connection to the Champion legacy and the town of Goderich. They bought back the Champion name from Volvo as part of the deal. So, as the new Champion website states, the Charlotte grader factory actually did return to its “roots” as the Abernathy family business, operating again under the Champion banner since 2004.”

    ReplyDelete