SCDigest Editorial Staff
Below is a round-up of this week's top manufacturing news.
Harley-Davidson Gains Substantial Union Concessions to Keep Factories in Wisconsin
Motorcycle giant Harley-Davidson announced this week it has reached agreements with its unions to keep production in its home state of Wisconsin, based on a new contract that includes union concessions that will ultimately save the company about $50 million annually.
Harley-Davison had threatened to shut down its factories outside Milwaukee and in a town called Tomahawk and move them to new locations if the unions that represent its hourly workers there - the United Steelworkers and the International Association of Machinists and Aerospace Workers - did not agree to a variety of concessions.
SCDigest Says: |
 At one point, thousands of US workers were involved in production of incandescent bulbs, especially in the Cleveland, OH area.
Click Here to See Reader Feedback
|
“We’ve been pretty clear all along that a ratified agreement would be key to our staying (in Wisconsin),” Harley-Davidson spokesman Bob Klein said this week.
Under the new seven-year agreement, the guaranteed full-time labor forces at a Milwaukee-area plant will shrink from about 950 to 700 and in the Tomahawk plant from 275 to 200. The new agreement provides a lot more flexibility for HD to use temporary workers to meet spikes in demand, vacation and other absences.
Wages will be maintained at current levels, and the unions will also join the same health insurance plan as the company's white collar workforce, rather than having their own plan.
By 2013, the changes should reduce manufacturing costs by about $50 million annually, the company said. The agreement was reached now even though the current contract does not expire until March 2012.
Volvo's New Chinese Owners Have Big Plans
The new owners of car maker Volvo are planning major expansion and three new factories in China, after the company was acquired from Ford Motor Co. in a deal that closed just last month.
Zhejiang Geely Holding Group made the deal to acquire the Volvo name and operations for $1.8 billion last year, with a goal of taking the mostly niche Swedish-based brand more global.
Zhejiang now says it will build three new Volvo factories that will build cars exclusively for the Chinese market, with the potential for as many as 300,000 vehicles annually. In 2009, Volvo sold just 335,000 globally - and just 24,000 in China - so the move would potentially nearly double Volvo's total production and sales volumes.
Chinese-based production is required for most Chinese government auto purchases, and getting on the approve procurement list alone could substantially increase Volvo sales in the country.
(Manufacturing Article - Continued Below)
|
The announcement shows the unintended consequences that can result from environmental policy. At one point, thousands of US workers were involved in production of incandescent bulbs, especially in the Cleveland, OH area. But the traditional incandescent bulb became a focus of environmentalists, who favor compact fluorescent (CFL) technology, which uses much less energy that incandescent bulbs do.
