Auto industry meltdown hurts employees of Columbia part manufacturers

Jesse and Valerie Dutton have next to nothing in their bank account.

"We had a decent savings,” Jesse Dutton said, “but now we've gone through it, and after all the bills are paid, we usually have less than $10 in the bank.”

After 14 years in automotive manufacturing, Valerie Dutton was laid off in February. Jesse Dutton, who works for Engineered Plastic Components Inc., has held onto his job on the company's assembly line, but he clocks in significantly fewer hours. The plant makes instrument panels primarily for Mitsubishi cars.

As the auto industry continues to erode, three of Columbia’s four auto parts manufacturers — Engineered Plastic, Dana Corp. and Otscon Inc. — have been forced to cut costs. Parts suppliers across the country have been hobbled by depressed auto sales and production shutdowns at both General Motors Corp. and Chrysler.

The Obama administration made $5 billion available to help GM and Chrysler pay suppliers earlier this year, but last week he rejected a request by suppliers for up to $10 billion in additional loan guarantees.

The fallout is hitting Columbia hard. Last year, Dana Corp. laid off 186 of its 351 workers, and in February, Engineered Plastic Components trimmed 22 employees from its workforce of 48. Four of the remaining 26 employees are hourly workers on the plant’s assembly line.

Financial challenges aren’t new to Engineered Plastic Components. It purchased the property in September 2007 after manufacturer Collins & Aikman filed for bankruptcy and closed its doors.

"We can't lose faith that we can rebuild," the company's senior engineer Dave Arnold said, citing an emphasis on improving efficiency.

He said layoffs at Engineered Plastic Components have been a difficult but necessary response to "drastically reduced" output.

Columbia's overall economy will suffer if the auto industry continues to decline because laid-off workers drawing unemployment will not be spending as much at Columbia businesses, he said.

"It puts a knot in your stomach, when you get to know someone, and you have to force hours on them or lay them off," Arnold said.

The city has long been a prime location for auto parts manufacturers, as businesses are able to supply parts to automakers in both St. Louis and Kansas City. Yet, as the nation's automakers declare or verge on bankruptcy, the climate has changed for parts suppliers and their employees.    

Auto parts makers make up the largest sector in the manufacturing industry nationwide, according to the Original Equipment Suppliers Association. These  manufacturing jobs represent 5 percent of Columbia's economy, and Bernie Andrews, president of Regional Economic Development Inc., said the city will continue to see a decline in its manufacturing base.

“With Missouri losing its assembly plants, they're not selling as many cars, they don't need as many parts, so the parts manufacturers are shutting down or laying off,” Andrews said.

Glen Stevens, a representative of equipment suppliers association, said more than two-thirds of the content of a vehicle is made by suppliers rather than automakers. Thus, Stevens said, suppliers “really take it on the chin” when automakers halt production.

For Columbia residents without post-secondary education, auto parts manufacturing has been a lucrative option for work, Andrews said. "Manufacturing jobs pay well, and typically have good benefits," he said.

Dana Corp. has cut its work force in Columbia by more than half. The plant supplies axles and drive shafts, among other parts, to Ford, Chrysler, and General Motors, as well as other auto companies.

Local plant manager Mark Howard said his company is in “very challenging, tough times,” reporting a 43 percent decrease in sales.

"We've worked with the state of Missouri to find jobs for laid-off employees," Howard said, expressing hopefulness for the employees remaining at Dana Corp.

"We've maintained stability since the beginning of the year," he said.

To prevent additional layoffs, Dana Corp. workers are taking voluntary one-week breaks without pay throughout the year to offset the company's continued loss of revenue.

Adam Withrow works on the assembly line at Otscon, manufacturing Honda Civic brake pads. While Withrow said there have been no layoffs, he reports a decline in production. Otscon, at 50 N. Rangeline Road, specializes in parking brake systems and brake pedals.

Withrow also said his overtime, attendance bonuses and pay raises have been eliminated. He said he and his family are trying to save money in anticipation of more cutbacks.

"We're rescheduling a summer trip for this winter to save money," he said, "and we're moving to a smaller place when our lease is up."

The fourth auto parts manufacturer in Columbia, Gates Corp., makes rubber and small auto parts in Columbia. Gates did not wish to comment on company production or the impact of the auto industry on its employees.

While Columbia’s auto parts suppliers are hopeful that the market will turn around for workers, the failures of major auto corporations make that hope harder to come by.

Meanwhile, Larry Houston, an assembly line specialist at the plant, said the economic downturn has transformed the workplace.

"Three years ago, there were 324 people working here,” said Houston, who now struggles to stay on top of his bills. “You could barely find a seat in the cafeteria."

Now, with all but four assembly line workers laid off, the cafeteria is often empty.