Archive for February, 2004

Maytag lays off 170 employees

February 27, 2004

Maytag lays off 170 employees
Date February 27, 2004
By DAVID PITT

Associated Press Writer

DES MOINES — Layoffs were under way at the Maytag Corp. plant in Newton on Friday, marking a grim day for 170 production workers.

“Anytime you’ve got people losing their jobs, it’s kind of a down mood,” said Jim McCleary, financial secretary for Local 997 of the United Auto Workers union.

Maytag, the nation’s third-largest appliance maker, is based in Newton, a town of 15,579 people about 30 miles east of Des Moines.

In addition to Iowa, Maytag has plants in Illinois, Tennessee, South Carolina, Arkansas, California, Ohio, Texas and Mexico. The company declines to release the number of workers at individual locations, but claims 20,000 employees systemwide.

McCleary said the number of workers at the two major manufacturing divisions in Newton _ Maytag Appliances and Newton Laundry Products _ is down about 600 workers in the last few years.

“We need to review our staffing levels based on production schedules as part of being a market-driven manufacturer,” Maytag spokeswoman Lynn Dragomier said Tuesday as word of the latest layoffs began circulating.

The layoffs come just three months before the contract covering Maytag workers in Newton expires. Negotiations toward a new contract could begin as soon as April, McCleary said.

The Newton workers likely will be asked to make concessions, said Jim Repace, president of Local 1985 of the International Brotherhood of Electrical Workers, which represents workers at Maytag’s plant in North Canton, Ohio. The plant is one of three making Hoover floor care products, including vacuum cleaners and floor polishers.

“I think they’re going to be facing some of the struggles we were facing here in North Canton,” Repace said of the Newton workers. “It’s a shame that it’s come to that, but it’s either that or the doors close.”

Under a new contract ratified in December, Maytag workers in North Canton and some retirees will pay more for health insurance and prescription drug coverage. The new contract also eliminated guarantees of specific job duties, giving the company greater flexibility over which models are being produced.

The new pact, which expires in 2008, did not cut wages, pensions, vacations or paid holidays, Repace said.

Maytag officials, saying foreign competition had driven down the price of vacuums, had told the IBEW they would consider moving jobs out of North Canton in 2005 unless workers agreed to the concessions.

“We’ve actually saved this American facility, and I think that’s important,” Repace said.

In Jan. 29 conference call with analysts, Maytag CEO Ralph Hake said the North Canton contract gives the company “necessary flexibility” while offering job security for many employees.

“It’s a model for preservation of jobs,” Hake said.

The North Canton plant cut 230 jobs this week. Another 130 workers will be laid off next month due to slow sales of the company’s Elite vacuum, the last upright vacuum to be made in the United States by unionized employees, Repace said.

What does Maytag’s future hold?

February 25, 2004

What does Maytag’s future hold?
Date February 25, 2004

By PETER HUSSMANN
Editor

One hundred seventy people will be laid off from Newton Maytag laundry production operations on Friday.

Maytag will soon launch two additional products to augment its high efficiency laundry offering. Production will occur outside the United States at an existing plant in Seoul, South Korea, in what’s being called a “partnership” with Samsung Electronic Co., Ltd., already a player in Maytag’s relatively new appliances services business.

The president of Maytag Appliances, Bill Beer, is currently touring local civic organizations saying that Newton Laundry Products, known to locals as Maytag Plant 2, will not be the site of any new platforms or products until such factors as quality, cost, safety and delivery are addressed. He is also telling community members the difficulties the appliance manufacturer faces in remaining competitive in a global marketplace.

The community is biting its collective fingernails.

Maytag’s spokesperson, Lynne Dragomier, won’t give the exact number of people receiving layoff notices. The “adjustment to production numbers,” i.e. workers, she said, is “driven by market demand,” a fluctuating situation which occurs from time to time depending on market forces.

UAW Local 997 President Pat Teed puts the number at 170 people. Further, he says, the total number of production workers now on layoff reaches nearly 600. Employees hired as long ago as April 1998, as Maytag ramped up production of its Neptune model, now find themselves without work.

In late January, during a conversation with investors, Maytag CEO Ralph Hake said the corporation planned to launch two new laundry products.

“We also expect to launch two additional products in 2004 to augment our high-efficiency laundry offering,” he said.

Dragomier said the announcement on Tuesday accounts for both of the laundry products first alluded to by Hake in a conversation with investors a month ago. She said the high-efficiency, front-load products, to be produced in Korea under the Maytag and Amana brands and sold through current distribution channels in the United States and internationally, do not amount to new product platforms.

The “strategic alliance” with Samsung, she said, was based on the corporation’s finding that it could find better “value” and “speed to market” through the “partnership” with Samsung than through its four laundry manufacturing facilities in the U.S.

Beer, the long-time local Maytag executive, who left the company briefly while Maytag was was run by former CEO Lloyd Ward only to be asked back under the interim direction of Leonard Hadley upon Ward’s departure, has met with a number of local groups, including a standing-room-only discussion with retirees in mid-February at the DMACC auditorium, to spell out Maytag’s business situation and how it might impact the community.

As it stands, Beer says in an article appearing in today’s Progress Edition, included inside this edition of the Daily News, the Newton Maytag production plant stands no chance of future investment for new product lines or appliance platforms due to its below than acceptable rankings on cost, quality, safety and delivery measures, among the other facilities within its other four U.S.-based laundry production facilities.

“As it stands today, Newton is not eligible for new product platforms,” Beer said. “There will be no new launches here.”

Maytag CEO Hake targets negotiations on the collective bargaining contract, which expires May 31 for UAW Local 997 members, as key to the future of local Maytag operations.

“Especially at Newton, we will be examining, with union leadership, how that plant can become more cost effective and competitive so that they may again become eligible for new product platforms and preserve jobs,” he said.

But both Beer and Teed are optimistic a successful conclusion to negotiations can be reached. Negotiations are expected to begin in early April with the contract expiring May 31.

“The management team at Newton Laundry Products and the UAW understand the work they need to do,” Beer said. “I’m an eternal optimist. I’ve been through lots of contracts and I remain optimistic the two groups will find ways to address the situations. The working relationship between the two groups has never been better.”

Teed agreed.

“I’m looking forward to a positive round of negotiations,” he said. “The new workforce is educated, hard-working and the most productive. We’ve always had a great relationship (with the company) and have always done what was asked. The future here is bright.”

New Maytag, Amana laundry lines to be built in South Korea

February 24, 2004

New Maytag, Amana laundry lines to be built in South Korea
Date February 24, 2004

By PETER HUSSMANN
Editor

A new product line of high efficiency, front load Maytag and Amana laundry products will soon begin to be produced by a South Korean manufacturer, Maytag Corp. announced today.

Maytag and Samsung Electronics Co., Ltd., announced today completion of an agreement where the Korean manufacturer will build the new product line at an existing South Korean plant.

Maytag officials said the agreement is designed to expand Maytag’s existing laundry product lines and strengthen its market position, both in the United States and internationally.

“Since these laundry models will be new for Maytag, this agreement will help us increase the variety of laundry products Maytag offers to consumers worldwide while continuing our tradition of dependability and innovation,” said Ralph Hake, Maytag’s chairman and CEO. “This laundry partnership will combine the best of Maytag’s design, testing, consumer research, marketing and sales expertise with Samsung’s laundry and electronics knowledge and world-class manufacturing capability.”

Maytag officials said the new product lines will not replace production of Maytag laundry products at its existing four laundry facilities and that laundry manufacturing will continue in the United States.

“We needed to get a product to market quickly and we decided to partner with Samsung,” said Maytag spokesperson Karen Lynn. “This is not part of what’s going on at (the Newton) plant. These are new products, not replacements.”

Maytag spokesperson Lynne Dragomier would not comment on the name of the new product, which price category the new products would target or the number of South Korean workers involved in the start-up.

Maytag officials said the new laundry models will be marketed exclusively under the Maytag and Amana brands and will be sold through normal Maytag distribution channels beginning later this year in the United States and international markets. In addition, the agreement with Samsung will “serve as a basis for discussion about other potential business cooperation,” Hake said in a prepared Maytag release. Dragomier would not elaborate.

“This is an extension of our laundry products,” Dragomier said. “This is designed to strengthen our laundry platform with additional offerings to consumers.”

Samsung Executive Vice President Moon Young Lee said the company is pleased with the agreement.

“We’re pleased to cooperate with Maytag, a leader in the United States laundry appliance market,” he said. “Our advanced technology, along with Maytag’s product development, engineering and design expertise, will ensure we maintain the highest standards of quality that customers expect.”

Maytag announced a partnership with Samsung last August when it created its new appliance services business to repair and provide maintenance on all major appliance brands. As part of the new operation, Maytag reached an agreement with Samsung Electronics America to allow Maytag Services to be an authorized service center for warranty and out-of-warranty work on Samsung appliances. Samsung holds the number one global market share in microwave ovens and also sells refrigerators and air conditioners.

In the announcement, Maytag noted the majority of its production operations are U.S. based.

“Approximately 90 percent of all manufacturing across the entire corporation takes place in the United States,” the press release stated. “In addition, 96 percent of Maytag Appliances’ manufacturing employees are located in the United States, where the corporation operates 12 manufacturing plants, including four laundry facilities.”

UAW President Pat Teed was in union negotiations on behalf of Vernon Company bargaining members this morning and unavailable for comment. The Vernon Company’s contract expires at the end of the month.

Be proud of accomplishments

February 17, 2004

Be proud of accomplishments
Date February 17, 2004

To the Editor:

In my 95 years in Newton I have been involved in many fund drives and in their final tabulations am amazed at how successful the drives have been.

As I review the amounts individuals have given I am always surprised at how much some, who I did not think had very much money, have given. Of course the other part of this is how skimpy others, who I know are well fixed, contributed.

We can’t overlook how fortunate we are to have generous givers like our banks, our local stores, the Maytag Company, the Maytag Foundation and the Maytag Family Foundation who have supported almost all of our major drives.

I have never seen any figures showing how much per capita is given based on the population of each town or city, but I’ll venture that Newton would be high on the list, particularly as compared to a larger city like Des Moines. My feeling is that as a smaller town we are better acquainted with our neighbors and fellow town folks so are more concerned about their livelihood so want to help. This has resulted in buildings like our hospital, “Y”Teen Center, Salvation Army, Animal Shelter, many beautiful Churches and many other facilities – all of these comparable to those in much larger cities.

We should be proud of what we have and that all of us have helped in these accomplishments.

Ed McCardell

Newton

Iowa governor uses Democrats’ radio address to criticize job losses

February 16, 2004

Iowa governor uses Democrats’ radio address to criticize job losses
Date February 16, 2004
By DAVID PITT
Associated Press Writer

DES MOINES, Iowa (AP) — Iowa Gov. Tom Vilsack on Saturday cited the layoff of 1,600 refrigerator manufacturing plant workers in neighboring Illinois to illustrate the devastation he said Bush administration policies have created.

Iowa-based Maytag Corp. is phasing out the jobs in Galesburg, Ill., and moving much of the production to a new plant in Mexico.

Vilsack used the Democrats’ weekly radio address to criticize the administration for suggesting in a recent report to Congress that the flight of factory jobs to other countries is a good thing.

“My fellow Americans, the president is trying to make election year lemonade out of a colossal lemon,” Vilsack said. “President Bush is out of touch with Main Street and too worried about Wall Street.”

He called the job losses a “terrible and historic setback for our economy and an impediment to our future.” He also criticized the administration’s tax cuts, which he said have hurt state budgets.

“Today, state governments have deficits totaling $90 billion,” said Vilsack, chairman of the Democratic Governors’ Association. “In the states, the economy is not an abstract issue. How do you raise educational standards or keep college affordable if you have to cut budgets to balance budgets?”

He said Bush could do what many governors are doing to help stop job losses.

Vilsack cited Illinois Gov. Rod Blagojevich’s proposal to create a transition training center to help the Maytag workers find new jobs. He also noted an Iowa plan to build new power plants and a seven-year economic development program designed to create 50,000 jobs.

“The president must apply the same focused approach to uplifting the national economy instead of chaining our children’s dreams to a rudderless and unfair economic agenda,” Vilsack said.