| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/2/2008 3:30:06 PM | WELLAND, Ont. - Tractor maker Deere & Company (NYSE: DE) is closing its factory in Welland, Ont., and moving the work outside Canada by the end of 2009, costing the Ontario economy another 800 manufacturing jobs.
The Welland factory, one of the city's largest employers, makes utility vehicles and attachments for commercial and consumer equipment and for agricultural uses.
The U.S.-based company says it's consolidating its manufacturing operations to improve efficiency and profits, and the work will be moved to plants in Wisconsin and Mexico.
Deere, makers of the famed green-painted John Deere tractor, announced Tuesday that it will take a US$90 million after-tax hit related to the closure. It said about half of this charge will be recorded in the fourth quarter of this year.
Gator utility vehicles, now made at Welland, will move to Horicon, Wis. Cutting and loading attachments will be transferred to Deere's operations in Monterrey and Saltillo, Mexico.
This is a huge blow to the economy of the Niagara region,where unemployment rates are already estimated to be between 7.9 and 8.2 % | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/2/2008 8:25:02 PM | | I didnt know Deere had another plant in Ontario. I worked for them when they bought out another tractor plant in Woodstock and I was one the 500 guys who got laid off after they shut down and left to USA back in 2006. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/2/2008 8:40:02 PM | I have one of their loaders, and have been down there.
It struck me as being a modern, clean, but Costly Facility.
People (in the office) were hardly over worked or over stressed and
I do know a few that worked there.
This would be the perfect model of a place to work, but it just isn't competitive in
the Global Marketplace! Too bad!
My business suffers as well with the annihilation of manufacturing in Ontario!
Yes, Times Change!
Just my two cents worth! | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 5:21:13 AM | | Sorry for the Canadians losing their jobs, but Canada signed up for NAFTA as well. Personally I think we should work out some illegal labor sharing agreement so more Canadians jobs can be taken by illegal residents as well. Kinda spread the water out in the sinking boat we both are in. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 5:27:13 AM | It IS too bad that JD is pulling out and leaving 800 employees out of work; how much will this impact on the community? Are many other businesses dependent on the dollars generated by John Deere there?
An interesting point is made about the workers not working too hard.
It seems that employees are required to take on additional responsibilities in order to save a corporation or the commonwealth a few thousand dollars, or a few ten thousand.
Alternatively, I have read entries from those who say that they are plugged into the forums all day at work because their work is "finished" and they need POF to fill in their time.
So maybe the added workload thing is just for the east coast Type A folks.
Just curious, was this a union facility? | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 5:48:33 AM |
This is a huge blow to the economy of the Niagara region,where unemployment rates are already estimated to be between 7.9 and 8.2 % This is also not surprising with the way the economy has been going... the higher the value of the Canadian dollar on the global market, the more expensive it is for companies to utilize Canadian resources...
Add to that a relatively large increase in minimum wage... companies have to cut costs somewhere and labour is certainly an area where trimming is viable for most companies... | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 7:01:28 AM | Yes,it was a union facility.
That's what it seems to boiling down to...paying workers in the U.S. and Mexico to do the same job for half the pay,as is the case with most plant relocations from Canada.
Specifically speaking,yes,it will cause some hardship in this area (I live 8 miles form the plant).This will be the 3rd plant to shut down in the area in the last few years,Atlas Steel and Hayes-Dana being the other two.(both unionized,I might add).
Makes me wonder ,if unions are worth it anymore,given the economic climate in the manufacturing industry? | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 7:27:35 AM | Unions used to be great for the worker. Now they're great for the Unions. My job requires I work in poorly ventilated, poorly lit, extreme temperatures, long hours, no breaks, no workers comp, no unemployment insurance, no health insurance and I love it! I am my own boss. I don't complain. I get $$$$$ to pay my bills. When I need a doctor, I just go & pay cash. I've been self-employed for 25 years, and still have my job, even tho I tried firing myself.
Here in Mendoland, when the Masonite factory shut down, we just grew pot. Our economy is fine. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 8:42:56 AM | For what it's worth, it was or is a highly automated plant!
Probably pretty much world class. Much of the welding was done
by Robots.
Just on a side note. The Government Safety people have been making
their rounds and costing my customers endless grief and millions!
I'm sure this contributes more then a little to the overall equation
of making this country more and more unprofitable to do business!
Another factor. There are much less expensive off shore imports
that are encroaching on the old established companies. They now
can buy the same high tech equipment and produce virtually the
same grade of products.
I know and work with a whole extended group of Mennonites
(Here in Ontario) that have VAST networks of companies that
produce steel and fabricate everything you could imagine using
the latest technology. Computers, Robots, Steel cutting Lasers
and water jet machines! They even hire Mexican Mennonites to
keep their labour costs low! Some of these, are in direct competition
with Deere for Loaders and Backhoes.
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 9:24:24 AM |
Makes me wonder ,if unions are worth it anymore,given the economic climate in the manufacturing industry?
I can understand the wondering, Leafslady, unions are about so much more than just wages, though.
Don't know if you saw the post by the gentleman who has Asperger Syndrome who lost his job, but, something like that would not go down without a fight at a union shop.
Job safety issues, better training ... LOL, I am a former local prez, what can I say?
Hope you all find some substitute employment for your neighbors and friends. Good luck. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 4:20:12 PM | It’s a microcosm of what is happening everywhere. With the economic downturn, companies naturally will tighten their belt in order to survive. In a town as small as Welland with a population of only 50,000, the impact of a loss of 800 jobs can be especially painful.
I’m not sure unions are a significant factor anymore. With all the Federal laws governing employment what is left for a union to do other than wage/benefit negotiations? They certainly aren’t going to save your job if an employer can’t afford to pay you.
Deere being a US company it seems logical they move some operations back to US plants. However, I doubt US workers will do the work for half the pay of a Canadian. That’s why they send work to Mexico (which I find ironic considering all the Mexicans trying to get into the US to find work). The US angle probably has more to do with the tax structure in Canada and better utilization of existing US plants.
I work for a manufacturer (non-union) and the same thing has been happening at our plant. Emphasis on efficiency, automation, downsizing, trimming unprofitable product lines or moving those product lines to Mexico to make them profitable. We are even to keep the lights off in areas of the plant not being used. It’s penny pinching to the max. How I’ve kept off the axe list is a mystery to me.
US automakers are in really dire straights, too. People just aren’t buying. Housing, new construction starts, you name it. Everybody is hurting.
But with every economic downturn there is an eventual upturn. When that happens there will be the resulting increase in demand, expansion of manufacturing capacity to meet that demand and companies will again start spending money. Some company will look at that closed Deere plant, see a profit potential and put it back to use, creating jobs. May not be tractors but who knows. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 7:08:26 PM | So why isn't the Ontario gov't offering huge bail-outs in order to maintain those jobs? They do it with the auto manufacturers, especially in Oshawa!
Guess if it has to do with farming, it can go into the crapper....Frikkin' politicians attitudes...like to see them do without food for awhile and see how fast they change their tune!
Besides...I would bet some of those guys have that job, just to keep the farm afloat...much like any other family farms today! | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 8:04:33 PM | The rest of the farming industry is at a record high. Deere probably mismanaged things. Canadian businesses are world renowned for their stupidity, beuracracy and inability to adapt.
Farmers are seeing huge demands in wheat, canola and methanol fuel growth. Farmers are on a buying binge for new gear. To fail in this market is just another example of Canadian incompetence in business. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 8:11:14 PM | ^^^^^^^I'm curious what farmers you have been talking to!
Have you seen the price of Beef lately????? And I'm not talking
about on the Super Market Shelf!
Some Farmers have simply been abandoning animals as it isn't
worth the food to feed them!
We have lost most of our major manufacturing around here! The good
news is that the Tim Horton's is finally supposed to be coming! lol | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 9:13:35 PM | ^Uh...why would it be more profitable to abandon an animal that could be sold even if at a loss ?
The government subsidizes farmers to the hilt. Maybe not like they used to but there is no shortage of programs designed to keep farmers farming while they wait for a profitable year. John Deere is a manufacturing facility though and the simple fact is that with the downward slide of the economy coupled with the high Loonie, manufacturing in Canada just isn't worth the cost. Add the cost of union labour onto that and you've got a recipe for a plant closure. On the other hand, if labour was the sole or even primary factor , JD would likely have told the union to either agree to lower wages or look for 800 new members. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/3/2008 9:35:29 PM |
he rest of the farming industry is at a record high. Deere probably mismanaged things. Canadian businesses are world renowned for their stupidity, beuracracy and inability to adapt.
Farmers are seeing huge demands in wheat, canola and methanol fuel growth. Farmers are on a buying binge for new gear. To fail in this market is just another example of Canadian incompetence in business.
I am not sure where you get your information from, but have you seen a beef or crop producer's bottom line lately. Sure there may be demand for the crop, but their input costs have skyrocketed, especially for fuel and fertilizer. I do not know of too many farmers around here who are out buying new equipment for their operations. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/4/2008 7:27:24 AM | Deere and Co, started near my hometown of Waterloo Iowa.
Deere probably mismanaged things
Deere rarely mismanages things anymore, unlike the early 80's.
After the recession of the 80's Deere remangaged everything from employee wages, to out sourcing.
One of the big things they did is to open plants in Mexico, Brazil and Germany.
In the early 2000's Deere found themselves burdened with an aged work force. So they made a bold move with new hires, with Union approval, to give new hires significantly less pay and benefits.
In 1999 an average Deere worker here in Iowa was well over $25 an hour plus generous benefits. Today those new hires make $12 an hour with limited benefits.
That is what you get with Globalization and a sell out Older Union.
It doesn't suprise me on bit that Deere is closing a plant. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/4/2008 4:23:46 PM | Even if the farming industry is doing well, this plant largely produces Gators - which are a C&CE product, not an AG product. C&CE isn't doing quite as well as AG is, so if they can shuttle some of their load around to help reduce overhead, it makes sense that they would. They already produce some of their Gators in Horicon, so if they can move more of that stuff there, it shouldn't be too hard to just start producing additional models on the same line.
It's sad that that many people are losing their jobs because of this, but that's the way companies operate, they want to make as much money as possible with as little cost as possible.
On the other hand, I doubt this is just because of the market, if they thought that things were just slowing down and would pick back up, they would probably scale down the plant a little and just ride things out - but it looks like they're going to take a little while (by end of 2009) to close it, so this is probably part of a longer term strategic plan.
http://online.wsj.com/article/SB122040434791993433.html?mod=googlenews_wsj | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/4/2008 7:59:16 PM | Skyrocketing fuel prices and a closure of a major meat buyer in toronto has really chopped into any profit a farmer may have made this year. They can't afford to keep feeding the animals when their "buyer" isn't buying any longer. They could go to the competition...and get a lower price, thereby taking a, loss. Easier to just put the animal down and write it off altogether...that makes more economic sense than taking an actual loss.
Farming practices, proceedures and business is a tad different from any manufacturing plant or retail store. Taking the whole loss can be, and often is, far better economically than taking a loss on the sales of a crop or animal. Gov't rarely covers those partial losses...but the total loss...yep...they can and will. As does crop insurance.
Some city folks don't see this sid eof farming.
Still feel they ought to use the big gov't bailouts. they do it for the autoworkers. | |
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/4/2008 8:28:22 PM | As I wanted to say but couldn't because of posting regulations is that
no farmer would take an animal (even for free) if he already knows
that feeding the animal will cost more then he can sell it for!
What I don't understand for the life of me, is why a steak appears
to sell at all time high prices!
Many, many things appear out of wack in the world today! I just got
off the phone with a customer telling me about the booming areas
where there are cottages selling for in the millions! I'm quite certain
that most of these people, arn't as valuable to our society as the humble
farmer!
As far as JD is concerned. The world has changed! You can put up a
building anywhere in the world practically overnight, fly in some welding
robots and other automated equipment, hire only a few skilled managers,
and a bunch of baby sitters and menial labourers to handle material, etc.
The programming for these machines can be done from anywhere in the world.
Gone are the days when you needed skilled welders and machinists or some
specialized facilities!
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| John Deere Plant Closure-800 workers to be unemployed
Posted: 9/5/2008 7:41:21 AM | It might be getting worse before it get's better. They're announcing that USA lost 84000 jobs last month, but truth be known, we, as in Canada, lost 95,000 jobs (gross numbers) in July. Our net job loss that month was 55ooo. Our unemployment rate across the nation is the same as the States as of this morning...6.1. Niagara's is 7.0, but apparently it dropped in August to 6.9. The Deere closing will probably push that number back up to 7 by the end of this month.
but maybe all is not lost just yet:
The Canadian economy staged a mild comeback in August by creating 15,200 jobs following two consecutive months of employment declines...
http://www.thespec.com/News/BreakingNews/article/430043
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Having grown up in Niagara up as a kid, it's always sad for me personally to go visit friends and family and then take my dog for a drive around and see where all the fruit farms i used to work on in the summers now all long ago plowed under for the mega-subdivisions down there. Heck, even the old homestead was plowed under. With the continued population growth thru the Horseshoe, I'm wondering if finding jobs for all these folks will continue to be an ever-growing challenge thru the Horseshoe.
I don't know how much more construction and expansion can go on thru there though. A couple of the towns in Niagara have no more building lots at all unless they go and get their Official Plans changed. My one chum that used to work for me years ago made himself about 3 million net down there a couple of years ago buying up some old delapidated buildings along highway 8, and sitting on them for about three years while he waited for the subdivision developers to get there. They got there. And he's on easy street now. Now he's just done the same thing again up in Smithville last year, but i hear the bottom's starting to fall out of the real estate market down there a bit as properties are apparently starting to sit a bit longer on the market now.
Good luck to ya down there. | |
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