m16ty

6 hours ago, kscarbel2 said:

After 5 owners in 12 years, a former Ford glass plant finally has a stable owner

Automotive News  /  August 1, 2011

Welcome to a huge and until now unwanted factory in the North American auto industry. It is the new home of Carlex Glass in Nashville.

How unwanted was it?

Try five owners in 12 years. Which is remarkable considering that for decades, without interruption, the plant has been supplying windshields and windows for some very popular U.S. light vehicles, among them the Ford F-150 pickup and Escape SUV.

But today it's different. Now that the storm of the recession is over, now that less committed players have vacated the field, Carlex Glass America, the U.S. operating unit of Japan's Central Glass Co., is moving in.

Carlex is one of many established suppliers that aim to turn the wreckage of the recession into opportunity by investing in new technology for the long term.

The Japanese giant couldn't have picked a less likely spot.

The dowdy, half-century-old plant sits on a hill overlooking downtown Nashville. Three brick smokestacks tower overhead, two of which were taken out of operation years ago. Inside, long lines of huge, gothic black machinery resemble locomotives abandoned in a dim train station.

The lights are out over what seem like acres of wooden shelves holding thousands of sheets of dusty glass.

The roof leaks.

New methods, complex shapes

But Carlex thinks this is the starting point for a play to expand its North American market share of windshields and side windows for cars and trucks.

Carlex peered into the neglected behemoth and saw a dusty jewel. It has begun investing $100 million to clean up the plant, modernize its equipment, demolish traces of its obsolete past, boost its capacity and use it to solicit more North American business -- ideally from the Detroit 3.

The company is betting on new technology, including a modern process called press-form. Unlike gravity-sag windshield shaping, the new process will permit greater manipulation of glass and provide the ability to handle more creative vehicle designs. The investment also will allow the plant to make thinner glass, according to customer desires. Thinner glass means less weight, which improves fuel economy.

The state of Tennessee is kicking in more money to help Carlex retrain and update the plant's 450 employees -- a fraction of the 3,500 workers who once produced windshields and windows for Ford Motor Co. there.

"Things are absolutely going to change here," declares Jim Shepherd, Carlex's executive vice president, who with his wife is moving to suburban Nashville from Detroit.

Sitting in his barren industrial office at the plant, with little more than a gray metal desk and a couple of metal-frame guest chairs from the era of black-and-white TV, Shepherd motions around the room. "We're going to knock down these walls. We're going to get away from this 1950s atmosphere."

Carlex will make the plant its North American headquarters, moving personnel there from the Detroit area, along with the suburban Detroit work force of Carlite, its newly acquired aftermarket auto-glass company.

"This place has been neglected, and we're going to fix that," Shepherd says. "The employees here might be a little jaded and uncertain about us, having been through so many owners who wanted to get rid of the business. But they will soon see we're serious.

"The biggest difference for us is that we're in the glass business. The others who came before weren't. They had their hands full with bigger concerns. Our only concern is making glass and windshields, and we believe this is the place to do it."

That, more or less, is the status of the 54-year-old glass plant.

But how the factory ended up at this juncture is a story that mirrors almost every trend that has come and gone in U.S. auto manufacturing for the past quarter century.

The industry's evolution from Eisenhower-era Big 3 hegemony to the Japanese invasion of the 1980s, the U.S.-Japanese joint-venture supplier bubble, the automaker divestitures of parts operations, the rise of megasuppliers in the late 1990s, the private-capital supplier wave -- it's all there in the run-up to Carlex's acquisition of the plant in April.

It all came and went.

The operation, originally created as the Ford Glass Plant, already was three decades old when Gary Casteel moved from Muscle Shoals, Ala., to work there as a young pipe fitter in 1988. As the in-house producer of much of Ford's North American windshields and windows, it was one of the biggest auto glass plants in the industry, with 1.8 million square feet under roof.

In the 1950s and 1960s, three enormous float lines heated the sand to 3,000 degrees in ovens that burn so bright they can only be viewed through hand-held black glass panels.

One of the Nashville plant's most notable features is that, unlike most glass factories, it houses the entire process. Workers bring raw sand in through one door, melt it and cook it into flawless glass. They then shape the glass, finish it, package it and ship complete windshields out the other door to vehicle assembly lines.

"I really don't know of any other plant in America that does it all," Casteel says.

Casteel was elected to the plant's UAW Local 737 bargaining committee in 1990. By that time the industry was under unfamiliar new pressures. Detroit was struggling through its second recession in a decade, and domestic market share was slipping away to import brands. Ford was eager to find new cost reductions and operating efficiencies, even if it meant divesting itself of some of its large in-house parts operations -- an issue the UAW resisted.

Today Casteel is director of the UAW's Region 8, a vast union territory stretching from Mississippi, Florida and South Carolina up through Tennessee and Virginia and into Pennsylvania, Maryland and Delaware. "That plant always ran well," Casteel says. "We always had good labor relations."

Japanese partner

But Ford's component management team informed the union in 1990 that the glass operation needed to reach beyond Ford business. A new corner of the industry was rapidly emerging in the form of Japanese automakers assembling vehicles in U.S. plants. Nissan Motor Co. was expanding car and truck production just a few miles away in Smyrna, Tenn. Honda Motor Co., Toyota Motor Corp. and others were opening assembly plants around the lower Midwest and Southeast.

But to gain glass business from such Asian transplants, Ford would need to form a separate joint-venture supply company in a deal with its large Japanese competitor, Central Glass.

"They told us: "We don't want to do anything to hurt the glass plant here,'" Casteel recalls. "But they said we really need to do this deal with Central to get more business."

The Ford-Central hookup was named Carlex, and the venture opened a separate state-of-the-art window fabricating plant in Vonore, Tenn., on the state's eastern edge.

Unwanted orphan

By the end of the 1990s, the industry was evolving again. This time, megasupplier mania was in the air. Individual component suppliers were merging and being acquired to roll up into multipart module and system supplier groups. The larger ones hoped to provide a sort of one-stop shopping for automakers, responsible for entire vehicle systems, including anything from a car's rolling chassis to its brakes and tailpipe and steering parts.

Amid great hoopla, General Motors spun off its vast global parts operations into an independent publicly traded entity, Delphi Corp. Ford similarly spun off its huge parts operations, including the Nashville glass plant, into a public megagroup dubbed Visteon Corp. [huge mistake]

Delphi went public in 1999 and Visteon in 2000 with visions of a bright future. But the ventures soon collapsed. In 2005, Delphi filed for Chapter 11 bankruptcy. Visteon followed in 2009.

By way of restructuring, Visteon identified 23 unwanted properties and business segments to unload -- among them, the Nashville glass plant. That decision in 2005 pushed the windshield factory off to new ownership by Automotive Components Holdings LLC, a safeguarding umbrella that sought yet another new owner.

A former Automotive Components Holdings manager, who asked not to be named, said the group's sole function was to "hold" and operate the glass plant with the other unwanted plants until viable buyers could be found.

Casteel also lent his time to finding a buyer for the plant.

"We approached everybody," he says.

"Nobody wanted it. The problem we encountered was that the only people who considered it were just after its book of Ford business. They thought they could move the business into their own plants and then close Nashville. We weren't going to let that happen."

Private equity buyer

The buyer who finally emerged in April 2007 was hardly a familiar auto industry name.

Robert Price, a wealthy investor from Tulsa, Okla., had made his fortune in commercial real estate and oil and gas investments. According to press reports at the time, Price was at least partly motivated by his desire to save the jobs at Ford's other glass factory in Tulsa. The older Nashville plant, along with a third glass operation in Juarez, Mexico, simply came with the package.

Price entrusted the operations to a newly formed entity first called simply Glass Products, and in 2008 renamed Zeledyne LLC. Zeledyne management drew from Ford's ranks of component executives, and the group took possession of the plants in 2008.

The deal wasn't unique; Price was part of a trend sweeping the supplier industry. Private investment companies were acquiring distressed parts makers at bargain prices, running them with independent management teams and hoping to use private capital to improve their profit picture.

Efforts to speak with Price or other members of the venture were unsuccessful.

But Price's timing couldn't have been worse. By mid-2008, the U.S. economy was teetering. By the third quarter, a banking crisis had locked up the capital markets, threatening business plans in all industries. By 2009, Zeledyne was frozen in place, along with most of the rest of the auto industry. Although the new team invested in Nashville enough to keep it operating, by 2010, the plant was again for sale.

Fresh investment at last

Carlex's Shepherd declines to say how much Central paid for the Nashville plant this year, noting that its acquisition did not include the Tulsa or Juarez factories. It did include Zeledyne's aftermarket glass business, Carlite.

Casteel believes the Japanese owner is in a good position to take the plant into new business deals. After 50 years of operation and more than 20 years of soliciting outside business, the plant no longer is owned by Ford.

It no longer is owned by a supplier in financial trouble. It no longer is owned by a private investor with an unproven track record. It no longer is being starved for capital improvements. It no longer is in jeopardy of being closed.

"We think we can help them get into GM and Chrysler now," Casteel says.

"These guys are serious global players. And they need this source of glass. I'm pretty excited about the future there. We've all been through a lot with that plant."

 

As I said, the union leaders ( Casteel ) has nothing but praises to say, all the while the people I know that worked there tell a very different story. I don't disagree that $30 per hour could be considered overpaid for what they did but $10 per hr for skilled workers that had 15+ years with the company?

Back during the '80s and '90s it was the typical big union plant. Overpaid workers that did absolutely nothing, having to call a electrician to plug in a extension cord, and having to call the janitor to pick a broom up that was left in the isle. The article alludes to that, 450 workers doing what it used to take 3,500 to do, so in a sense they did this to themselves. 

Back during the heat of the last election we were doing some work in a TVA (big union) coal plant that was being closed directly because of the actions of the Obama administration. I talked to several that weren't at all happy about loosing their jobs and blamed Obama but you'd still be surprised at how many "union for Obama" bumper stickers you saw in the parking lot. That was then and this is now, I'm thinking when the layoff slips started getting passed out reality started setting in and they are changing their tune.

We had a local Ford glass plant that sold out. A friend of mine went from making close to $30 a hr to $10. All the union would offer is to just be glad you still have a job (but keep sending in those dues). My friend walked. The worst part about it was before all this went down the company was offering $20K+ buyouts to people that would just quit but the union was telling everybody to just hold on and things would work out. Not only did he get the huge cut in pay, he walked with nothing because he didn't take the buyout when he had the chance. 

I have several friends that were once big union supporters and would vote a straight democrat ticket just like the union told them to. Every one I've talked to is voting Trump the time around and a couple are campaigning for him.