After 124 years of operations, auto parts stalwart New Process Gear shuts down

After operating since 1888, New York-based New Process Gear (NPG), a unit of Magna International, was scheduled to shut down at the end of the second shift on Thursday, August 23, 2012.

In 2003 NPG boasted $1.5 billion in sales, a headcount of 4,000, and a payroll of $5 million a week. Then in 2007 NPG recorded a loss of $117 million. The next year the New York State Department of Labor noted in a report about the state’s labor force that ”Weakening demand for 4-wheel drive vehicles and increased competition in the automotive industry adversely impacted New Process Gear.”

As the OEMs struggled NPG flailed along with them. Chrysler‘s revenue dropped from $62 billion in 2006 to $17 billion in 2009. General Motors fell from $207 billion in 2006 to $104 billion in 2009. Ford‘s revenue declined from $172 billion in 2007 to $128 billion in 2010. As demand fell for Ford, Chrysler, and General Motors vehicles, Magna International tried to reach out to serve other OEMs, but the effort proved unsuccessful.

In February 2009 Magna announced that the NPG plant would be closed after workers voted against a contract that would have lowered wages or closed the plant if it could not break even by July of 2009. Employees against the contract said it might have locked them in at lower unemployment compensation if the plant did close.

Now about 370 are left at the plant. At the end of the second shift on Thursday, they will preside over the shutdown of the plant’s last two assembly lines. The last products to roll out of the facility, which began operating when Benjamin Harrison was elected president and the US had 38 states, will be a transfer case and manual transmission. Once the pair of assembly lines are halted, about 30 workers will stay at the dark plant to put the finishing touches on the shutdown.

Syracuse Post-Standard writer Charley Hannagan wondered in an article about the plant’s closing if some kind of ceremony might observe the processing of the last products. United Auto Workers Local 2149 President and New Process Gear plant engineer Jim Dagnesi told him, “People aren’t celebrating this. It’s sad.”

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Picture by Paco Rivière, used under a CC-Share Alike license.

John MacAyeal

John MacAyeal has worked at Hoover's since the era of Hawaiian shirts and Y2K angst (aka the late 90s). Now he's surprised to have survived into this time of skinny jeans and 2012 angst.

Read more articles by John MacAyeal.

Comments

  1. That’s a sad story, John. But thanks for bringing it to our attention. I guess the collapse of the US auto industry was hard to see coming. Did they try to diversify into other industries at all? Or was it too little, too late by the time the industry began to tank?

  2. John MacAyeal says:

    Lynett, the area’s US representative, Dan Maffei, weighed in on the possibility of saving the plant. He is quoted in a sidebar to a Syracuse Post-Standard article as saying that Magna International did not show interest in keeping the plant open by reinvesting in it. The paper quotes him as saying, “If they wanted to really keep the plant open, why didn’t they invest in these new technologies. They needed in my view to retool that plant long ago.”

  3. Lesley Epperson Lesley Epperson says:

    John, I enjoyed this post (even if it is sad). Lots of history there. Unfortunately, when the car manufacturing industry was in trouble, a lot of lesser-known suppliers of electronics, parts, machining, painting, and other products and services suffered. Some of the big suppliers like Magma survived, and some of the smaller firms retooled (some even went into the electric battery and solar components businesses with government grant money) — but many, many small and family-owned businesses depended heavily on trade with the Big 3 auto makers. It would be interesting to know how many of those little guys are gone, even as the auto makers appear to be on the way back?

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