UAW members up in arms about $37.3 million in stimulus money going to company that’s exporting Norwalk jobs to Mexico

SanduskyRegister.com Front Article

UAW members up in arms about $37.3 million in stimulus money going to company that’s exporting Norwalk jobs to Mexico

 
By CORY FROLIK

Thursday, January 21, 2010 11:25 AM EST

Register photo/SHAWN FOUCHER Commercial Vehicle Group, CVG, in Norwalk.

President Barack Obama shouldn’t expect a warm welcome from members of the UAW Local 1379 when he rolls into Lorain County on Friday.

They plan to demand an explanation from the president about why the federal government is handing over $37.3 million to Navistar when the company is transferring its production work to Mexico.

As a result of Navistar’s decision to export work, one of its contractors, Commercial Vehicle Group, will close its two Norwalk plants, resulting in pink slips for about 120 employees.

A United Auto Workers member said he is confident local members will get a chance to address Obama and express their outrage at the government for giving tens of millions of taxpayers’ dollars to a company that is sending American jobs south of the border.“They are taking work out of the United States and taking it to Mexico,” the union member said.

In December, Navistar announced its decision not to renew its contract with CVG for cab assembly. The company plans to send cab assembly work to its existing assembly plant in Escobedo, Mexico.

CVG manufactures truck cabs and truck parts. The Norwalk plants assemble parts exclusively for

Navistar.

The loss of Navistar’s contract means CVG stands to lose $10 million to $15 million in revenue this year alone and as much as $35 million annually, the company said in a news release.

Navistar received a $37.3 million grant from the U.S. Department of Energy for research and development. More than half of the funding for the Navistar project and eight others came from the American Recovery and Reinvestment Act. According to the agency,

Navistar will use the money to develop technologies to improve truck and trailer aerodynamics, combustion efficiency, waste-heat recovery and other elements.

Roy Wiley, Navistar spokesman, said the decision to insource cab assembly to Mexico has nothing to do with the grant the company received to improve heavy-duty trucks.

“Those are apples and oranges,” Wiley said. “This is just research money from the Department of Energy to get more fuel-efficient heavy-duty trucks.”

Wiley said Navistar is not sending jobs to Mexico, but instead, the company is simply moving work to its existing plant.

“It has nothing to do with stimulus or taking jobs,” Wiley said, adding Navistar is providing jobs in Fort Wayne, Ind., and locations across the U.S.

But Navistar’s decision pulled the rug out from under CVG’s plants in Norwalk. Layoffs begin at the plant this month.

Union members said it’s unclear how many employees will survive the first round of cuts, but everyone will be dismissed when the plants shut down in April.

Ellen Heinz, Norwalk’s economic development director, said city officials are doing everything they can to help ease the painful transition and provide assistance to workers and company management.

“We’re looking at many different avenues — we’re talking with the Ohio Department of Development, state officials, and state and federal representatives to see what we (can) do for the workers in regards to training and placement services,” she said. “A number of community leaders have worked nonstop on this to try and do as much as we can for the workers and to keep jobs in Norwalk.”

Heinz said CVG wants to keep Norwalk’s plants open, but the loss of Navistar’s business proved

devastating.

City officials have not met with Navistar management, but Heinz hopes the company will agree to meet with them soon.

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