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$98-Million in bonuses for workers at bankrupt Delphi. Under intensive questioning Delphi Corporation officials admitted plans to dole out $98-million in bonus money to non-union workers at the company that slid into bankruptcy last year because of the failure of management and workers to adequately compete in the marketplace. The word comes out as the company is seeking permission of the bankruptcy court to void its union contracts. Union members are preparing to vote on the matter and approval is expected. (5/11/06)
Mayor Tucker retires from Delphi. An employee at GM-Harrison/Delphi for 28-and-a half years, Lockport Mayor Michael Tucker, retired from Delphi Thursday, April 27th. He had been working nights at the Lockport plant while doing days as city mayor. He is among hundreds at Lockport who are taking advantage of the Delphi/GM paid incentives to opt out for early retirement. Another is City Councilwoman, Flora McKenzie.(4/28/06)
GM Offer to union workers seen here in favorable light. The offering by General Motors, announced Wednesday, March 22, would also impact many ex-GM employees now working at the troubled Delphi plant in Lockport. About 110,000 GM UAW union workers and 13,000 at Delphi have been offered between $35,000 and $140,000 to quit their jobs and in some cases give up retirement benefits and all ties with GM. The offer appears to be effective for many at Lockport and could influence deals Delphi offers directly to its Lockport workers. Initial word on the street Thursday morning, 3/23 was favorable. Many hope the proposal will aid a Delphi settlement to avoid a strike. (3/23/06)
New York Power Authority to grant more low-cost hydro power to Delphi/Lockport. The Delphi facility already gets a sizeable allocation of low-cost hydroelectric power from the Niagara Power Project, just 15 miles away. Now, at the urging of Gov. Pataki in an effort to help the local employer battling bankruptcy, reduced sales, and high labor costs, an additional megawatt allocation has been announced. (3/4/06)
Co-Generation at Delphi. A private vendor runs this co-generation facility on the border of Delphi's Lockport campus. Heat produced from burning piped in gas produces electricity. Such operations, state-wide, are subsidized in effect by state residential electric rate-payers.
Delphi proposes to stop treating its own sewerage. The wastewater treatment plant off Upper Mountain Road has been in operation since the 1950's. Back in those days effluent from the Harrison plant turned the waters of Eighteen Mile Creek hues of blue, green, and other colors. The wastewater treatment plant stopped the significant pollution of the waterway. Now, the company indicates different processes it uses release much less toxic material. It proposes to let the city of Lockport worry about treating its wastewater. Charges from the city to Delphi could approach $300,000 yearly for the sewer service. It is not immediately known how much additional cost the city will incur but it is believed to be substantial. (3/4/06)
End of March new Delphi strike deadline. The company, in bankruptcy, has again backed down on its deadline to enforce wage cuts and other money-saving contract changes that would impact its union employees nation-wide. The new deadline is March 30th. Labor union promise a strike once such action takes place. The company, now in the process of losing millions daily because of a bad labor agreement, sees no turnaround without a new labor contract with wage costs cut by more than 50%. (3/1/06)
UAW VP against warns of strike against Delphi. Richard Shoemaker warned this week of a national strike against Delphi if the company moves to terminate its labor contracts on February 17th. Shoemaker acknowledged the dire financial condition Delphi is in and is quoted as saying, "It's impossible to expect that our current wages and benefits will remain intact for the long term. (2/4/06)
SOS at Lockport Delphi January 8th. The militant labor group, which calls itself, "Soldiers of Solidarity" has scheduled a strike rally at Lockport Delphi on January 8th according to information provided to the Lockport Home Page over the weekend. SOS leader, Greg Shotwell declared in a press release, "We're making it clear we want to go on strike and we want to shut down GM." That statement indicates the group not only wants to see Delphi collapse but also General Motors. Shotwell had nasty comments about Delphi CEO Steve Miller last week and the group has been in the forefront of public actions encouraging slow-downs at Delphi plants. (12/26/05)
Pay cut January 1st. Delphi
Corporation CEO Robert Miller (pictured) has his pay cut from $1.5-million yearly to
$0.0 yearly effect January 1st. The slash in Miller's pay will continue, he says,
until Delphi emerges from bankruptcy. Other top Delphi executives will take pay cuts
in the range of 10 to 20%. Union workers have yet to take a pay cut with their
employment status still pending. A revised target date for such action has now been
moved into February with the company backing down several times now on its declarations it
would slash employee pay by up to 60%. Miller has promised one more return visit to
the Lockport plant which is a likely target for sale or closure unless union matters can
be resolved. (12/28/05)
Delphi backs down on wage cuts. Management of the bankrupt Delphi Corporation backed away from proposals to cut union wages by up to 60%. They also moved their demand for union compliance with new employment conditions into mid February. Union members in Lockport were reported delighted and some were claiming "victory" in their employment battle with Delphi-Thermal. Business reports indicate that a change in the Delphi position may have been made as a result of concessions by General Motors in on-going talks with Delphi over GM's responsibility for the employment liabilities at some of the units spun off to Delphi, including the Harrison Division at Lockport. (12/22/05)
Flyer advises Lockport UAW members to get ready. A January strike at Delphi Corporation appears even more likely this week as United Auto Workers Union leadership in Detroit issued more threats and Lockport union leaders sent flyers to their membership advising them to intensify preparations for a likely strike. Delphi management has delayed proposed wage cuts from a mid-December date until January 20, 2006. Although talks between Delphi and the union leadership ended when labor leaders called the company's last offer an "insult" and refused to forward it for a membership vote, the company is in on-going talks with its former parent, General Motors. A GM subsidy to the bankrupt Delphi is seen as a potential help to the costly union labor agreements Delphi has been stuck with. Speculation continues in the financial press that a long strike at Delphi could lead to bankruptcy for General Motors, the biggest Delphi customer. (12/8/05)
About 800 at Labor Rally outside Delphi-Harrison. The event on Wednesday, 11/30, at Noon drew union members and politicians outside the company's Upper Mountain Road facility. Most all expressed hope that a strike could be avoided and that Delphi would remain in Lockport but no concessions to the company were pledged. Union leaders were not mild in their attacks on Delphi and company management who propose wage cuts of 50% and more with slashes in benefits and lax work rules to allow the company to compete with US and foreign made goods with much lower labor costs. One union leader called the stand-off with Delphi over labor costs as "an assault against every worker." (11/30/05)
Strike deadline now into January. Delphi Corporation indicated Monday that it will not move to void contracts until about January 20th. The previous target date was December 16th. The company explained its reason as connected to on-going talks with General Motors, its former parent. (11/29/05)
Union rally Wednesday at Delphi-Lockport. UAW activists are calling for what is seen as a protest rally against Delphi management on Wednesday, November 30th in front of the Lockport Delphi-Harrison plant off Upper Mountain Road. The demonstration is set for 12Noon. It is not known exactly what the union hopes to accomplish by the rally which likely will further feed bad feelings between local management and workers. However, union leaders are concerned that their membership provides strong support should a strike begin---an action that local members reportedly will not be allowed to vote on. (11/28/05)
Lockport UAW HQ Daily Scene Of Strike Talk
Any reality of permanent loss of jobs isn't getting front stage attention as members gather daily at Local 686, United Auto Workers Union, 524 Walnut Street in Lockport. Since the Delphi bankruptcy, members here and around town have been talking tough. They face wage cuts of 50%, benefit cuts, and work rule changes in order to make the Lockport plant competitive in the world market. Most talk from members on the street and local watering holes is "Let the strike begin!" Such a strike, if for more than a few weeks, would likely lead in permanent closure of the giant Lockport facility where about 3600 are employed. The union hasn't cooperated adequately, company officials say, with pre-bankruptcy efforts by Delphi to cut rampaging losses at the Lockport plant. Locally, a change in attitude is not seen likely as strike deadlines approach. 11/26/05
CEO says all U.S. Delphi plants may close. Robert S. Miller told the financial press Friday, 11/18, that all of the company's United States plants must see wage rates decline to the $10-$17 range, not just the extremely "troubled" facilities such as Lockport. Miller indicated that radiators, made at Lockport, could be made elsewhere after about a six month delay. He noted that come of the company's U.S. competitors such as Johnson Controls and Lear Corporation pay only $17 to $22/hour and are also pressing for wage reductions. Delphi claims its national average wage is $26.97/hour plus benefits. (11/19/05)
Union members won't be permitted to vote on Delphi strike. UAW President Ron Gettelfinger indicated Wednesday, 11/16, that union members would not be permitted to vote on the latest, enhanced, offer from Delphi Corporation. Gettelfinger termed the offer, that showed somewhat better wage and benefit terms that the previous, as an "insult." Since Delphi described it as the "final offer" both sides seemed ready for a strike sometime after the December 16th deadline. Projections on Wall Street indicate that General Motors would probably go into bankruptcy if the Delphi strike goes three months. If union members are not permitted to vote, it's likely the strike would be long term. In Lockport, however, union members are talking so "tough" it would seem that a strike vote here would pass by a sizeable margin. That is not to say that the union would stay firm after strike fund benefits start to phase down. (11/17/05)
Management blamed for Delphi problems. Union representatives, meeting in Michigan Monday, 11/7, blamed Delphi management for the company's financial crisis. That assessment was no surprise. Nor was the union's denial that its own above-market wage demands, benefits, and work rules contributed to the company's undoing. They found some agreement with the financial and auto industry The Lockport Home Page confers with. His view of the problem has long been wage costs at Lockport are the primary problem but he now concedes that management of the Lockport facility over a near ten-year period was the biggest local factor in Lockport's now undesirable status as a very troubled plant. Our analyst says that it was management who failed to make their case with the union over a 20+ year period and gave in to demands so as to avoid labor strife and thus endanger their own positions. And Lockport management was more fully responsible for quality and production problems here along with light non-GM sales of product. (11/8/05)
Delphi CEO inspects Lockport plant. Robert S. Miller was in Lockport Thursday, 11/3, to inspect operations at Lockport's huge thermal products plant and to "apologize" for the stress caused workers due to talk of closure. He indicated he was impressed with the $350-million in technology upgrades the plant has received since Delphi took over and said he would be back in Lockport one more time in the month ahead. A decision on Lockport appears delayed until the first quarter of 2006. The humble talk by the CEO did not appear to mollify angry Harrison workers. The union talk against the company still appeared nasty into the next day. Unionists appeared unimpressed that Miller had reduced his own salary to $1/year for the duration of the financial crisis. A small press conference was held but the Lockport Home Page was not notified, seemingly a local PR policy that goes back to disclosures made at this site over five years ago regarding the possible closure. A company spokesman denied a report published in the Lockport newspaper that indicated a "work-to-rule" slow down was being advocated at Lockport as a union action. The spokesman said production at Lockport was normal or slightly above normal. In a separate development, the City of Lockport made a move to engage a lawyer so that it can "intervene" in the Delphi bankruptcy proceedings. (11/4/05)
Another Aid Package For Delphi/Lockport proposed. New York Gov. George Pataki proposed about $20-million in grants and aid for Delphi/Lockport over the weekend. Included in the enticement for the auto parts maker to remain in Lockport is an allocation of 10% more cheap hydro electric power (which would bring total to about 24.3 Megawatts) and cuts in Workman's Compensation Insurance costs. (10/30/05)
Miller reveals huge labor cost disadvantage at Lockport plant. Delphi CEO Robert S. Miller is quoted Friday out of Washington, DC as saying the Delphi's national labor cost (wages + benefits + taxes) is $65/hour. That shocking "average" cost figure is thought to be exceeded at Delphi's Lockport plant. At Delphi plants in Mexico the same total labor cost is quoted by Miller as $3/hour and in China, where Miller says Delphi has over ten plants, at $1.50/hour. Mr. Miller cited as especially galling the $3 to $4/hour cost that New York State mandated Workman's Compensation Insurance adds to Lockport manufacturing costs. Meanwhile many union workers in Lockport are remaining firm in calling for a strike against the bankrupt auto parts maker saying they will not give in the company calls for wage cuts. (10/29/05)
No progress with labor talks at Lockport. The latest word from Delphi is that the company is asking for cuts in worker pay down to as low as $9.50/hour at the Lockport plant. Many unskilled workers are now getting about $25/hour with recent hires getting less. In addition to the wage cuts, there would be increases in employee contributions and co-pays in the health insurance program, and a stop to the costly "job bank" program in which workers who are laid off get up to 95% of their base pay from Delphi as they are awaiting call-back. In October, approximately 85 workers at Lockport are reported enjoying that benefit---a program that increases costs at Lockport by millions of dollars a year. Word on Lockport streets remains defiant among workers, some of whom are heard saying things like "Bring on the strike!" Sources say changes in work rules could cut numbers on the payroll at Lockport substantially. Meanwhile production continues here at healthy levels as customers such as General Motors try to build parts inventories. It has been stated in the financial press that GM probably could not replace the volume of parts it receives from Delphi for many months. However once replacements are obtained, probably from overseas sources, it would add to the reasons for putting high-cost production facilities such as Lockport on close-down or outright sale regardless of wage settlements. (10/27/05)
The CEO for Delphi said Wednesday, 10/12, that the Lockport plant could be out of the Delphi family because of high wage costs. Robert S. Miller (photo left) singled out the Lockport plant for national mention after the UAW local union issued a strike threat against the company. Delphi, about to enter its second week of bankruptcy has been asking for union cooperation for over a half year in terms of trimming excessive wages at Lockport and getting nowhere. Wednesday at a press conference in Troy, Michigan, Mr. Miller indicated Lockport labor costs could be three times the US market rate and that in general, "It's a scandal in New York how costly it is (to operate a business)."
A business analyst speaking to the Lockport Home Page told us this morning that he didn't expect union cooperation and could see Lockport operations closing in 2006. "Of course, they will try to sell what they have there," he said, "but even if that happens operations would be greatly reduced with employment going way below 1,000 under new owners. I predict sizeable union strife from a leadership who won't give in to reality and changing world markets. The union will lose no matter what happens in Lockport but losses could be less, although severe, if they were to give in now, not later." Our source said again, "Based on what I've seen over the past ten years, I don't see the union giving in." Asked if he saw any possible future for Delphi in Lockport he responded, "Yes, but only under huge wage cuts. There are a multitude of other factors favorable to keeping the Lockport operation going. One of other negatives is that with big wage cuts the current workforce would probably be hostile and that is another problem even a new owner at Lockport would have to deal with." Delphi has said that it plans to submit new written contract proposals to the union by the end of next week.
The mood on the street in Lockport Thursday morning. 10/13, remained defiant. Longtime union workers were using words like "bring on the strike." Many feel they will just pull up stakes here and move to other markets where they will still get their $20+/hour wage rates. Lockport Mayor Mike Tucker, a longtime Harrison-Delphi worker, is not seen as attempting to intercede in the matter at this point.
The predicted December strike could, some sources indicate, be an action that would end work at Delphi/Lockport permanently. The company reportedly as plans for closure at Lockport on the work table, if not ready to put in place.
10/13/05
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Union warns of strike at Lockport. The financial press is reporting that Officials of the United Auto Workers Union sent out messages Tuesday, 10/11 to workers at Lockport that a strike was likely if Delphi, now under Bankruptcy Court supervision, decides to cut worker pay and/or benefits. Those compensation packages are considered as much as ten times the cost of worker compensation in third world countries where competitive Delphi/Harrison products could be built and at least twice the cost of US-based competitors. Rank-in-file workers in Lockport have been heard voicing strong support for a hard union line against concessions to the multi-national auto parts maker whose Lockport operations are considered one of the company's biggest loss items. Lockport Mayor Mike Tucker has offered the opinion that the Lockport plant will not be closed. Tucker, a union worker at Harrison for nearly thirty years, clocks hours at Harrison nights and works in the Mayor's Office days. Meanwhile many local government officials are saying that the survival of the Lockport Delphi plant is "out of our hands." The Lockport plant has received over $20-million in taxpayer-funded aid in the past five years, and has had its tax assessment in Lockport cut by millions---causing tax charges for most other city property tax payers to soar.
10/12/05
The Party's Almost Over
Weekend newspapers form a backdrop
for memorabilia from the glory days of Harrison Radiator in Lockport.
Gold-themed item from the celebration of General Motor's 50-millionth car sale in 1954 are spread out over October 2005 newspapers telling of the bankruptcy of the successor company, Delphi Automotive. The balloon, wrinkled and weak if only partially inflated---bloat would break it just as payroll bloat and poor management has promoted the Lockport Harrison plant to one of the biggest losers for Delphi. Closure or sale is in the cards for 2006.
Harrison veterans were at Chet's Dog House, downtown Lockport,Monday morning, October 10th, bemoaning their fate. One union loyalist declared, "They're NOT going to get away with cutting our wages---we'll shut them down!"
At least four Lockport Pagers can trace their lives in Lockport back to the Harrison Radiator Division of General Motors and those great company picnics each summer at Olcott Beach. Some reports on Monday described Delphi stock at near worthless. There was also speculation in the financial press that former parent of the Lockport operations, General Motors, had a 30% chance of going bankrupt since they are said to have extensive contingent liability for much of Delphi's obligations. We'll be hearing from them along with our special financial analyst who predicted the demise of the Lockport operations eight years ago. Stay tuned. Additional updates and features will follow in the weeks ahead.
10-10-05
Delphi Corporation filed for bankruptcy Saturday, October 8th after union officials failed to yield to request for slashes in wages, work rules, benefits, and retirement pay-outs. The company indicated negotiations with the unions and former parent, General Motors were continuing. CEO Robert Mill said in Michigan that there would be no immediate change in operations in the week ahead. The Lockport plant, where about 3900 are still employed has been identified as one of the biggest loss leaders in the entire Delphi operation.
Associated Press and national business news wires were "smoking" over the weekend with various angles and implications.
The automotive parts multi-national business blames exorbitant high US wages as the prime cause of financial trouble followed closely by unrealistic employee benefits, work rules, and too-generous retirement pay-outs. Delphi Thermal is paying almost double the wages that some competitors pay and work rules cripple the company. Employees on lay-off are paid up to 95% of their normal wages so cash gushes out of the company even when layoffs are instituted as a result of reduced industry orders such is presently the case.
Operations at Lockport have long been described as one of the biggest losers. Management at Lockport and above refused to adequately deal with hundreds of sky-rocketing employee labor costs for fear of confrontation or strike. The highly paid white-collar types chose instead to try to maintain their own comfortable favor and position in an industrial culture that goes back decades into the years of General Motors ownership. The last major executive for then-Delphi-Harrison, even refused to live in Lockport instead taking residence in the high-rent suburbs of Erie County.
Talk around Lockport over the weekend was intense. Residents of this strong union town, seemed to voice strong blame at Delphi executives for all the troubles and many unionists vowed not to give up a dime of their pay packages. Lockport Mayor, Mike Tucker, himself a long-time Delphi-Harrison/Harrison/GM worker, told the press he was "concerned."
The Lockport Home Page has been in touch with its Delphi specialist and we expect to have an interview or a report on the situation in the week ahead. This expert has been predicting sale and/or huge employment cuts (down to 500 or less) at the Lockport operation for over eight years. He had identified late 2004 as the facility's date with destiny and although it appears his forecast was about one year early the Delphi bankruptcy, the financial situation at Lockport, and the union situation all seem to be coming out according to his forecasts.
Oct 9, 2005
Another warning that improvement needed at Lockport Delphi-Harrison.
The chief financial officer for Delphi Automotive said Monday, 12/10, that Ron Pirtle, the president of Delphi-Harrison at Lockport, needs to "get critical mass to diversify their customer base and improve their cost structure." The translation of that in plain talk is that the local operation still hasn't reached minimal Delphi goals and, with the plan now in place, probably won't unless economic conditions greatly improve over forecast. That in turn means, that additional initiatives by the Lockport Delphi-Harrison management, probably in cooperation with the union, will be necessary sometime about mid-2002. The Lockport plant remains on the "troubled plant" list for Delphi and plants don't stay on that list year after year. Delphi CFO Alan Dawes said that Delphi will be cutting about 1,000 more jobs, worldwide, most of them in non-union positions. He said still additional cost-cutting is needed in Delphi's thermal divisions to produce the profit margins that justify new investment. (12/11/01)I am not surprised at the report from one of your Lockportians-At-Large relating a conversation with a Delphi manager who claimed the Lockport plant would "probably" be closed in "one or two years." I disagree, however, on the time frame. I'm sticking with my projection sent to you about two years ago. The year 2004 remains, in my opinion, the time that most factors point to. Additionally, I can't predict now---maybe nobody can---if some type of operation would remain in Lockport, perhaps with 500 or fewer employees, after the main Delphi exit. I see one of three possibilities.
(1) Concessions on taxes and union contracts.
I was surprised to learn the extent that the city of Lockport gave reduced assessments to the company. This will give Lockport property taxpayers this year and next a taste of what they will have to pick up if and when the operations there are fully or partially terminated. A note of optimism---given the sacrifice the assessor has given up I would not be surprised to see some additional and special considerations by the State of New York which already made a "donation" last year. I am not at all optimistic about a satisfactory union contract. The amount of give-backs that will be required to make labor costs at Lockport competitive with costs elsewhere is much, much, more than I can see any union like the UAW agreeing to. Your report of a senior custodian being allowed (because of a union contract) to work all the overtime he can handle so as to make over $100,000 a year is illustrative of the employment problem there. How can any company survive paying out that kind of money for janitorial service? It doesn't take an MBA to imagine the extent of management failing here. Granted this example is extreme and of only one or two persons, but just ponder how many (hundred) other, less extreme examples there are. National union leadership, afraid of precedent-setting, would probably rather see Lockport operations close than agree to a massive give-back in contract terms. Would local union members be able to prevail should they be so motivated by threats of job losses and closure? I don't think so. However, if the company can get the concessions on its union contracts all other problems are solvable. There remain many big reasons for remaining in Lockport. It's just that the union contract as it now exists is a giant reason to give up and walk away. What was good and fair fifteen years ago is not viable today with the global labor and production market most US companies must compete in. Some management, and most union leaders, refuse to acknowledge this. With a different employment contract at Lockport, suddenly product quality, scheduling, and efficiency concerns would be adequately addressed. If there's a local management problem remaining, today's corporations will have little patience to allow such a culture to fester when a division's survival is at stake.(2) Sale of the Delphi-Harrison unit.
Since other Delphi-Harrison plants appear to be operating more satisfactorily than Lockport this route appears less likely. It would, however, get Delphi out of a problem it appears to be unable to solve. But who would buy? A sale now would mean a big hit to the Delphi bottom line. Additionally, any sale would surely precipitate the changes or closure at Lockport that current management and union have been avoiding.(3) Closure at Lockport.
More likely operations there would be cut back to as little as 500. With operations remaining having limited union employment. The real estate would be parceled up. There are property and environmental factors at Lockport the company just couldn't walk away from. I would expect the closure would come as a phase-out over several years beginning in 2004. That's the way such events happen at most other giant industrial facilities when the parent company has not entered a form of bankruptcy. Look at the steel industry as an example. I certainly do not expect Delphi even approach the financial distress that would cause consideration of bankruptcy. That's unlikely to happen to Delphi. That's why they will act on the Lockport problem.That's not financially significant in the big picture. However, it is useful so that local management is showing it's working on cutting costs. That move should have been made a couple years ago. It will take dozens of such actions to make a significant difference. But---"a journey of a thousand miles begins with the first steps." Lockport Page: What impact will USA at war have on Delphi-Harrison and the Lockport situation.
I have little idea. However, I expect it is unlikely to be negative. I don't think the company can reasonably close in Lockport any sooner than my projections. After all, their plan allows for the prudence of several key steps each of which, or a combination of such, could save Lockport operations. But as I've said, I don't think those steps will be effected. Now, with a major war on-going, who knows what needs the country will have, supply problems it may face from global sources, etc? If business were to substantially increase (and before war talk that didn't appear likely) pressure would be off for any plant closures. I just really don't know...or expect to know...anytime soon. I really don't have enough now to even speculate. Lockport Page: We sent you a copy of the message from our Lockportian-At-Large, most of which we didn't publish. Is there something we should have published that we didn't?
I think you did the right thing not reproducing that executive's comments. All of his complaints about workers could be addressed if the company could hire and fire at will. Which it can't. Thus it retains a very significant number of unsatisfactory workers. I disagree with his generalized comments on worker quality. I believe the worker base around Lockport is superior to that found many other places. Lockport Page: Can you give us any suggestions for action?
Other than concessions on the union contract I don't have any special knowledge to share with you. Of course a ground swell of community support and the involvement of County and City officials wouldn't hurt. But unlike trying to attract a new industry to a area, Lockport has a big advantage because so much property, investment, key people, etc. are there now---and it's big. But I don't see anything overcoming the cost of labor, the handicap of work rules, and other union-related factors. And, I don't see the union giving in. Go read some American industrial history of the past thirty years.
The giant Lockport plant of Delphi/Harrison must come up with a plan within 30 days to turn sagging profits around or face being placed on the Delphi "Troubled Plant" list. That's the story headlined Thursday, 6/1 in the Lockport Union-Sun & Journal which stated annual net profit for the Lockport Plant had dropped to 3.8-percent last year and was projected to "go down into the negative in the year 2002." Neither the newspaper or the company would elaborate on what the "Troubled Plant" list is or what it implies. The benchmarks for Delphi Automotive for its Lockport operations are reported to be a 5-percent annual net profit and a 12.5% return on net assets --- both modest goals in today's financial world for big business.
The newspaper reported that 5,000 Lockport Harrison employees were told about the company's financial performance troubles on Wednesday, 5/31. Any turnaround would not happen overnight but top Delphi officials would expect to see improvements within 6 to 12 months. Delphi-Harrison Lockport management and union leaders were reported giving employees briefings on Thursday. Delphi CEO J. T. Battenberg has reportedly made several visits to the Lockport complex since the Delphi spin-off from General Motors and is said to be "concerned."
The Lockport Home Page reached its only (and anonymous) analyst on the Delphi-Harrison operation Thursday night who indicated he had no fresh information on the situation at Lockport. However, he recalled his projection of a year ago when the Delphi-Harrison spin-off was first announced:
I gave the Lockport situation five years at that time. There have got to be big changes in the tax and/or labor costs at Lockport. It is unlikely the company will get big relief in both areas. They can influence the labor costs more than the tax situation but that requires concessions by unions. Today's press may be part of a long posturing strategy to get those concessions. The labor contract they are working with at Lockport is a cement that, unless modified extensively, will cause operations as we know it at Lockport to sink. The only thing that could overcome this is a major exclusive technology break-through. Is such a move likely in this rather mature industry? It would be a shock. A year ago I said a key to Delphi-Harrison Thermal was the ownership and licenses for accumulated technology - the company's biggest asset, the full impact of which I have not evaluated. It is still not clear to me what the real arrangement is between Delphi and GM regarding this. However, it doesn't appear to have a bearing on the Lockport manufacturing situation. Delphi can cash in their bank of accumulated technology assets at other manufacturing locations more friendly to the bottom line. I don't have any inside information on the mood of management or labor at Lockport but I do know that the current situation can't continue past four more years. Toward the end of that timeframe I can see the start of a partial, reversible, phase down of Lockport operations. I really don't have any views anyone at Lockport wants to see.
The Thursday newspaper story tied in the recent departure of the local plant manager George Mayes with the current story of performance problems at Lockport. Late on Friday, 6/2, the company was announcing to select media that Guy S. Jones was coming into Lockport to take charge as local site manager. The 34-year Delphi veteran has a significant success story behind him and the move indicates top efforts will be made to turn the Lockport situation around. Jones is seen as the top Delphi talent available for the assignment. In 1994 he was managing Delhi's Grand Rapids (MI) plant named by Industry Week as "Best Plant in America." The urgency of the Lockport situation is highlighted by disclosure that Mr. Jones had been set to serve as Delphi-Thermal business line executive for heating, ventilation and and air-conditioning. He will reportedly retain that position while trying to boost efficiency performance at Lockport. While running the Lockport site, Jones will also be sitting on the Delphi-Harrison Thermal Systems Executive Committee. Delphi's top executive in Lockport, Ronald Pirtle, a company Vice-President, will remain here. (6/2/00)
Biography being written on Herbert Harrison. Dr. Mohinder S. Bhatti, an engineer at Delphi Thermal Systems is writing a biography of Herbert Harrison. Though he has done extensive research, he is still missing some information. He would especially like photographs of Florence Harrison Zwicker and Mrs. Charles Harrison, along with the first name of Mrs. Charles Harrison. If you have any personal photographs or recollections of the Harrison family, please contact Dr. Bhatti at Delphi-Harrison in Lockport or via the Lockport Home Page. (4/21/00)
Update 6/10/99
Democrats In Assembly "Flip Flop" On Delphi-Harrison Aide Package
Democratis in New York State Assembly, under direction from Assembly Speaker Sheldon
Silver, Tuesday, 6/9, indicated they are backing down on a committment to allocate $20-million in funding for Delphi-Harrison in Lockport. The State has still not approved a budget document. Silver refused the money to Delphi-Harrison to save jobs, and fund training, despite strong pleas from local UAW leaders. The move, seen as a slap in the face to Niagara Frontier interests, will be the subject of "intense" efforts by Assembly Republicans and GOP state bosses to have restored.Wednesday, 6/9, under intense criticism for breaking his word, Sheldon Silver backed away from his threat to cancel support for the Delphi-Harrison package. And in a classic "flip-flop" the Assembly's chief Democrat said he has supported the package right along.
State officials announced Thursday, 2/10, that Delphi-Harrison in Lockport would receive a direct grant of $20-million of taxpayer funds to continue and update operations in the city. The money is included in amendments to the $72.7 billion state budget proposed by Gov. George Pataki. The $20-million is expected to get approval by State Assembly Democratic leaders because of support by the UAW union.
$15.3 million of the grant will be used for new plant equipment, $1.3-million for facility "enhancements" and $3.4-million for employee training. Delphi-Harrison itself is planning to invest $361-million in Lockport operations over the next five years. The large company investment is seen as the reason that the state agreed to $20-million in taxpayer money. The taxpayer grant is believed to be given without any Delphi promises to maintain or increase employment levels but, as State Senator George Maziarz declared, "just a show of good faith that we want to assist them." (2/12/99)
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