Published October 13, 2008 09:49 pm - The downturn in the U.S. automotive industry is starting to cause some layoffs in Crawford County.
Meadville Forging suffers layoffs in Crawford County
By Keith Gushard
The downturn in the U.S. automotive industry is starting to cause some layoffs in Crawford County.
Meadville Forging Co. has furloughed a total of 13 workers from its local operations, said Bill Glavin, company president.
Meadville Forging, which had about 365 workers at its Meadville and Cambridge Springs plants, made the layoffs Friday, said Glavin.
The workers at privately held Meadville Forging are members of the United Steel Workers Union and average about $15 a hour. Meadville Forging is a subsidiary of the Keller Group of Winnetka, Ill., a privately owned iron and steel maker, according to Hoover’s Inc., an Austin, Texas, business information company.
Meadville Forging makes more than 25 million wheel hubs a year — a total that represents more than half of the U.S. domestic auto market for automobiles and light trucks. It makes about 22 million of them at its Meadville and Cambridge Springs plants. The company isn’t a direct supplier to General Motors, but it does work for first-level suppliers to the auto giant such as Delphi and Timken.
“It’s the high cost of gas and the lack of (automotive) financing that’s hurting the industry,” Glavin said.
He said automotive sales are off about 25 percent in the U.S. and that’s starting to have an effect on suppliers like Meadville Forging as automakers cut back.
Meanwhile, to diversify its customer base, Meadville Forging has picked up some new contracts in the past few years, including making metal forged parts for Allison Transmission Inc., a maker of vehicle transmissions; and wheel spindles for Toyota’s popular Corolla car model, Glavin said.
It’s unknown when the furloughed workers would be recalled, but Glavin doesn’t anticipate any more layoffs at his firm.
“It seems like it’s as bad as it’s going to get,” he said.
In the fall of 2007, Meadville Forging began switching from making larger truck hubs to making smaller hubs for cars as GM began to make more cars than trucks.
However, GM said Monday its making cutbacks at its factories sooner than planned.
On Monday, GM said it would close a metal stamping plant by the end of 2009 in Grand Rapids. The plant employs about 1,340 hourly and 180 salaried workers, GM spokesman Tony Sapienza said.
GM also said it would cease operations at its Janesville, Wis., sport utility vehicle factory Dec. 23 — idling 1,200 workers. It’s the second of two sport utility vehicle factories GM said it will close ahead of schedule.
The factory makes the GMC Yukon, Chevrolet Tahoe and Suburban full-size SUVs, and sales of those vehicles have plummeted with an increase in gasoline prices to around $4 per gallon earlier this year. Gas prices have subsided closer to $3 per gallon nationwide, but that has done little to boost sales.