Area auto plant beats recession, plans to hire

Tenneco Inc.

Ownership: Publicly traded.

Based: Lake Forest, Ill.

Products: Automotive emission- and ride-control products.


2008: Net loss of $415 million.

2009: Net loss of $73 million.

2010: Net income of $39 million.

First quarter of 2011: $47 million, up from $7 million in the first quarter of 2010.

Kettering plant: 390 employees working on 930,000 square feet. Worldwide: About 22,000 employees.

Customers for Kettering plant: General Motors, sister North American Tenneco plants and an unnamed foreign automaker’s North American plant by 2013.

Source: Tenneco

KETTERING — Brace yourself. One of the last big auto plants in the Dayton area is hiring.

The Tenneco Inc. suspension parts plant at 2555 Woodman Drive was built at a time when the auto industry ruled the Dayton economy, providing thousands of jobs and millions of dollars of tax revenue.

But the industry, hammered by changing consumer tastes, operating inefficiencies, bankruptcies and the Great Recession, has shrunk in recent years, leading to the closure of numerous local auto plants and the loss of many livelihoods. The fact that the Tenneco plant survived the turmoil and is seeking new workers today makes it stand out.

The plant makes shock absorbers and struts primarily for General Motors passenger vehicles such as the Chevrolet Camaro, Cruze, HHR and Volt, as well as the Buick Regal and LaCrosse. The plant also supplies sister Tenneco facilities in North America and, starting in 2013, will supply a foreign automaker’s North American plant. Tenneco officials would not identify that automaker.

The plant employs 390, putting it third behind the Behr Dayton Thermal Products plant with 800 workers, and the DMAX truck engine plant in Moraine with about 450 employees. The Tenneco plant has added about 50 workers since July 2008.

Tenneco plant managers are always looking to hire skilled and semi-skilled toolmakers and machine operators, said Terry Youngerman, the plant’s human resources manager, and Joel Belvo, the plant’s manager. When the plant’s applicant pool runs low, a “help wanted” sign is sometimes placed on Woodman near a plant fence, Youngerman said.

Given what happened in the auto industry, it’s a wonder the plant remains open.

“We’ve definitely weathered some of the financial storm that the whole industry went through,” Belvo said.

In June 2008, Tenneco leased about 40 percent of the Woodman Drive plant from then-bankrupt Delphi Corp. Tenneco made the move as the worst recession in decades undermined the nation’s economy and auto sales started slumping.

In 2000, U.S. annual auto sales totaled just over 17 million vehicles. Yearly sales of 14 million would have been considered a “recession,” said David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich.

But by the end of 2008, U.S. sales were just over 13 million vehicles, the worst performance since 1992. In 2009, as the recession bottomed out, the total sank to 10.4 million vehicles, the lowest since the early 1980s, according to industry observer Autodata.

For full-year 2010, new car and truck sales in the U.S. hit 11.6 million, an unthinkably low number just five years before, but an 11 percent improvement over 2009.

“What we saw over the past few years was really a weaning out of the weak players and the marginal players in the market,” said Randy Berlin, global practice director for Urban Science, a Detroit-based consultant for the retail side of the auto industry. “And that goes all the way to the supply base.”

Delphi closed or sold at least six local plants even before the recession, and GM closed its SUV assembly site in Moraine. Today, the automakers have fewer facilities and employees. The domestic industry’s new “break-even” point is sales of 10.5 million vehicles a year. Anything above that is icing on the cake, Cole said.

Cole called Tenneco “one of the companies that have come through the valley of the shadow of death.” It reported net income of $47 million for the first quarter 2011, more than the company made in all of 2010 and well up from losses in 2008 and 2009.

Belvo and Youngerman point to safety, culture and an emphasis on quality and cost control for the company’s turnaround.

That latter point may be the most important. James Winship, president of the International Union of Electronic Workers-Communication Workers of America Local 755, which represents hourly Tenneco workers in Kettering, said the relationship between company and union is good, but today’s Tenneco workers are paid less in wages and benefits than they were than when Delphi operated the plant. He did not provide specifics.

“They came in at a way lower contract than what the Delphi people were used to,” Winship said. In today’s competitive environment, that’s understandable, but “everybody wants to make as much money as they can,” he said.

Cole cautions that there are no guarantees in the auto business, particularly with volatile fuel prices and overall economic conditions. But he believes suppliers who focus on innovation and quality — those not making simply “pure commodities” — can survive.

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