more job loses

Analysis:

The reason cited in the Press for job loss was because “the auto supplier’s biggest customers pulled their business.” Both General Motors and the Lear Corp. are mentioned as customers. The article also states that “MacDonald’s has plenty of company among troubled suppliers. Many face the same crunch with big domestic automakers who — under intense competition — are cutting costs wherever they can.” This statement is never verified, both in terms of what competition and cost cutting means for companies like General Motors. The only people cited in the story were a supervisor and a company spokesperson. No workers are cited in the article, but it was stated that the factory was non-union.

At the very end of the article there is mention of tax breaks given to MacDonald Industrial Products, one by the City of Kentwood worth $3.8 million and one by the City of Grand Rapids for $3.9 million. Both of these tax breaks were tied to the company needing to create more jobs. The company didn’t follow through with the Grand Rapids tax break and had to pay a fine of $300,000 and the article ends there. Why didn’t the reporter ask what the company did with the other $3.6 million if got from taxpayers that didn’t create jobs? The article also doesn’t explore what happens to tax-payer subsidies when companies shut down.

Story:

KENTWOOD — Nearly 300 employees of two MacDonald’s Industrial Products Inc. plants face the loss of their jobs in coming weeks after the auto supplier’s biggest customers pulled their business.

The announcement Saturday did not detail when layoffs at two plants in Kentwood and Grand Rapids would begin, but local workers said they were told they would be jobless in two to four weeks. The plants employ 294.

A third plant in Spencerville, Ohio, that employs 176 will shut down first.

“This day is heartbreak for all of us; we tried everything possible to avoid this,” said Robert MacDonald Jr., the founder’s son.

The family-owned company makes door handles, grilles, emblems and decorative trim.

The announcement was made after MacDonald’s biggest customers — General Motors Corp. and Lear Corp. — dropped their contracts. “We got the notice late Wednesday,” MacDonald said.

The news was shared in letters to employees this weekend. Workers felt the owners’ pain, supervisor Dennis Pearo said.

“It’s been a long decline, but it came really quick at the end,” said Pearo, noting GM and Lear made up 80 percent of the company’s business. “Even the owners were surprised. They were trying until the end.”

The nonunion supplier makes chrome-plated plastic injection-molded parts at its Grand Rapids plant on Oak Industrial Drive SE and zinc die castings at its plant and headquarters on 44th Street SE.
“Like so many other automotive suppliers, we had been putting forth our best efforts to survive,” MacDonald said, “but when General Motors and Lear decided to move their business elsewhere, we just ran out of options.”

MacDonald’s has plenty of company among troubled suppliers. Many face the same crunch with big domestic automakers who — under intense competition — are cutting costs wherever they can.

At the end of a grueling week, MacDonald said he worries most about the employees who will lose their jobs.
“Our work force is incredible,” MacDonald said. “Whoever their potential employer is, he will be getting a work force that puts their hearts and souls in what they do.

In 2004, MacDonald’s sought a Kentwood tax break to add $3.8 million in equipment and 40 to 50 jobs at its 44th Street SE die-cast plant. It planned to diversify into making appliance handles.

That same year, MacDonald’s paid Grand Rapids $300,000 after the company failed to keep a promise to invest $3.9 million in equipment and create 60 jobs at its factory at 850 Pannell St. NW. The company now uses that site for a warehouse.