Official is upbeat on Valley plants

Packard is asking its workers to focus on their jobs and to care for customers.
By DON SHILLING
VINDICATOR BUSINESS EDITOR
WARREN -- Mahoning Valley plants should fare well as Delphi Corp. looks to cut costs, a local development official said.
Delphi Packard Electric Systems, a Warren-based division of Delphi, has invested heavily in area plants, making some of them among the best in the world, said Reid Dulberger, executive vice president of the Regional Chamber.
In the past five years, the maker of wiring systems for vehicles has invested $100 million to create injection-molding plants in Cortland and Vienna that churn out billions of plastic parts a year yet have defect rates of near zero.
Packard also has invested tens of millions of dollars to upgrade plants at its North River Road complex in Warren that make cable and metal parts.
Delphi is expected to close plants as it tries to become profitable, but Dulberger said that Packard has taken many steps in recent years to cut its costs and become more efficient.
Valley closings
Packard has closed manufacturing plants in Warren, Hubbard and other areas as it has sent the labor-intensive assembly of wiring harnesses to Mexico. Local workers now focus on running machines that produce large volumes of parts.
Packard has continued to reduce its staff, offering retirement incentives to both hourly and salaried workers. Packard employs about 5,000 in the area, which is down 2,000 from four years ago.
Still, Delphi intends to come up with a reorganization plan that will include cost cuts.
"The question is: How will that impact the Valley?" Dulberger said.
Normal operations
Douglas Hoy, a Packard spokesman, said operations are continuing as normal for now.
"We need for all employees to remain focused on delivering the very best to our customers," he said.
Hoy noted that the bankruptcy filing is not a liquidation, and Delphi is not going out of business.
"While we may not know all the answers today, we do know that every facility here at Packard must play a role in continuing our operations and serving our customers," he said.
Officials of Local 717 of the International Union of Electrical Workers, which represent about 3,800 area workers at Packard, are assessing the bankruptcy filing and can't comment on specific details, said Don Arbogast, union shop chairman.
Arbogast said, however, that he thinks Delphi "has chosen the least honorable way to deal with a financial crisis that is largely of their own making."
Concessions sought
Delphi officials have been public about demanding concessions with the United Auto Workers, which represents Delphi workers in other areas. UAW officials have said that Delphi was looking for cuts in wages of more than 50 percent and reductions in benefits.
Delphi hasn't said much about needing concessions from the IUE.
Arbogast said he hasn't had any talks with Packard or Delphi officials about concessions, and he wasn't aware of any such talks on the national level. Hoy said, however, that Delphi officials have had talks with national IUE leaders.
Besides the employees, Delphi has thousands of retirees in the Mahoning Valley.
Some reorganization plans allow a company to back out of pension obligations, which then are turned over to the federal Pension Benefit Guarantee Corp. This agency insures pensions but only makes payments to certain levels.
General Motors Corp. also bears some responsibility for Delphi pensions under an agreement created when GM spun off Delphi in 1999.
Dulberger said this uncertainty over the future is bound to create anxiety among Delphi workers and retirees. This could cause them to hold back on making large purchases, which wouldn't be good for the local economy, he said.
shilling@vindy.com