Archive for January, 2004

Hake says production costs may hinder future Newton employment

January 30, 2004

Hake says production costs may hinder future Newton employment
Date January 30, 2004
By PETER HUSSMANN
Editor

Maytag Chairman and CEO Ralph Hake told investors on Thursday that the high costs of producing appliances in Newton need to be brought down in order for production to continue at its current levels.

Hake spoke with economic analysts after the corporation released fourth quarter and year-end financial results.

Hake said that pending union contract talks with United Auto Workers Local 997 will be important to future production levels at the Newton plant. He said production operations must become more cost-effective for the Newton plant to gain any new platform production responsibilities.

“Especially in Newton, we will be examining with union leadership how that plant can become more cost-effective so that they may again become eligible for new product platforms and preserve jobs,” Hake told analysts in a conference call.

Maytag’s current contract with union workers in Newton expires on June 1.

Similar cost of production issues led Maytag to decide more than a year ago to shutdown its Galesburg, Ill., refrigeration facility and move that production to Mexico. Nearly 1,600 workers in Galesburg will lose their jobs once the plant is completely closed at the end of the year.

Current Maytag production levels in Newton stands at about 1,700.

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It boils down to semantics

January 9, 2004

It boils down to semantics
Date January 09, 2004
By Peter Hussmann
Editor

Was Dick Gephardt’s recent statement that Maytag is moving Newton jobs to Mexico just a shoot-from-the-hip attempt to rally the campaign forces in the week ahead of the first-in-the-nation caucuses or was there truth to the claim?

Was Maytag rightfully incensed that a presidential candidate would choose to speak so recklessly and attempt to paint the Iowa company an unwarranted black brush or was there something to what he had said?

All of the above, I suspect.

Getting to the bottom of the statement hasn’t been easy. The Gephardt folks have ignored calls and e-mails. Maytag says it doesn’t comment on its staffing and production levels. The company was, however, adamant that no Newton production jobs were moving to Mexico.

What hasn’t been said, and what I suspect is the basis for both Gephardt’s statement and Maytag’s denial, is talk that first surfaced in Newton about three months ago.

Several callers let us know last October that Maytag was planning to shut down its die cast operations in Newton and outsource the work. Calls to Maytag at the time were greeted with the usual polite response that no comment would be forthcoming.

Now, three months later, a convergence of facts — with differing viewpoints about what those facts mean — has the town wondering what’s going on.

Speak to any production worker at Maytag and they’ll tell you die cast operations are in the process of closing. The work will be outsourced.

This is nothing new. Maytag outsources a number of the internal parts that go into the assembly of its world famous washers and dryers. Some of them come from Mexico.

This is likely what’s behind Gephardt’s statement. A check of the Internet turns up a Missouri-based company, Leggett & Platt, North America’s largest die cast supplier. Information on the Web lists Maytag as a client.

The corporation’s aluminum group has two plants in Mexico, Pace Industries de Chihuahua and Pace Industries de Mexico in Saltillo.

So, Gephardt’s reasoning appears to go, since Maytag is outsourcing its die cast work and the company likely doing it — try to get confirmation on that — has Mexican operations , then Maytag is moving Newton jobs to Mexico.

In the strictest sense that it is true. Jobs that were once done by Newton workers may now be done by workers in Mexico.

But Maytag’s argument, in the strictest sense, is also true.

Maytag said it is not moving Newton jobs to Mexico. What Maytag is doing is outsourcing the work to another U.S. company. Maytag has no control — or involvement — in where that company decides to produce the products to meet its contract.

Semantically speaking, both sides are right. Which side you sit on determines its validity.

——

Councilman Ron Foreman has been fielding some calls from concerned constituents about what appears to be a new crackdown on the enforcement of building codes.

In a recent issue of the City Report, new building official John Raney gave citizens some “tips” on what they need to do before they build — anything.

What concerned Foreman, and others, is that it appears about the only thing you can do to your property without first securing a building permit is change a lightbulb.

“No building or structure, including electrical, gas, mechanical, or plumbing system shall be erected, constructed, enlarged, altered, repaired, moved, improved, removed, converted or demolished unless a permit has first been obtained from the Building Division,” Raney wrote in his “tip” sheet.

This statement left Foreman scratching his head.

“It appears to me you can’t do anything without a permit,” Foreman told the council. “You’re encouraging them to become illegal. The way it’s worded you need (a permit) for everything.”

Community Development Director Jon Ewing, Raney’s boss, said the requirements are nothing new and actually have been required for years. However, he said, there might have been some confusion in the way the information was presented.

City Administrator Dave Schornack said he would meet with the building officials and possibly put out a release that would clarify the process.

I hope so. I just put up a new paper towel holder on my kitchen wall. In broad daylight, no less.

——

The city’s new requirement to require builders, roofing contractors and homeowners to secure a building permit for re-roofing is also drawing concern.

As of Jan. 1, city officials said, the permit is being required to ensure that all work is being done in accordance with code provisions, including the removal of extra layers of old roof material as well as the installation of new sheathing.

And just to prove that the requirement is not a money grab by the city due to the number of roofing jobs in the city following last year’s hail storm, residents have until April 1 to get a permit free of charge. After that, it’s going to cost you based on the cost of the materials and labor for the job.

A question that many have asked is what constitutes “re-roofing.”

“Do you mean if a windstorm tears off a couple of shingles I can’t go up on my roof and fix it without a permit?” Newton resident Danny Young inquired.

We’ll follow that up Mr. Young. But I bet you can guess what we’ll find.

Gephardt backs union workers

January 8, 2004

To the Editor:

As a union representative at Maytag, I have seen the effects of NAFTA firsthand. NAFTA has destroyed our manufacturing base in this country.

We cannot continue to let our jobs go to foreign countries unchallenged. Dick Gephardt is the only candidate in this race that has fought NAFTA since its creation. Gephardt also voted against normal trade relations with China.

Our future, our jobs, depend on who we choose as the Democratic nominee. Gephardt has what it takes to beat Bush. I will be attending my caucus and supporting Dick Gephardt. I hope you will do the same.

Brad Parker

Bussey