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Grove cuts 225 jobs

August 20, 1998|By RICHARD F. BELISLE, Waynesboro

SHADY GROVE, Pa. - Grove Worldwide on Thursday announced the elimination of 225 production and salaried jobs, including those of four vice presidents, at its Shady Grove plant.

Earlier this month, Grove said it was closing its crane-manufacturing plant in Sunderland, England, which employed 670 people.

This week's staff reductions in Shady Grove, the closing of the British plant, along with cuts in spending, improved purchasing and other restructuring, will save the corporation $19 million a year, according to Grove spokesman Robert Kannel.

Some local employees were told Wednesday that their jobs were being eliminated and some were told Thursday. The firings were unexpected, said one high-ranking employee who lost his job.

Keystone Inc., a Fort Worth, Texas, investment firm, announced on March 11 that it was buying Grove Worldwide for $605 million from Hanson PLC. Keystone owns Bell and Howell, plus other companies.

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A few days after the sale was announced, Keystone said it was replacing Grove chairman and chief executive officer Robert C. Stift with Salvatore "Sam" Bonanno, CEO of Foamex International and former general manager of international manufacturing operations for Chrysler Corp.

G. Fred Heidinger, senior vice president and chief financial officer at Grove, left with Stift.

Hollis Rafkin-Sax, spokeswoman for Keystone in New York City, did not return calls Thursday.

In May, when the sale to Keystone became final, she said Keystone would offer Grove guidance, financial resources and a chance to increase efficiency. She said the new investors had no immediate plans for any changes in Grove, which at the time employed about 5,300 people worldwide.

Grove does not verify employment figures, but it is estimated that about 2,500 people were working at the Shady Grove plant.

Grove designs and makes mobile hydraulic cranes, truck-mounted cranes and self-propelled aerial work platforms.

The company hired 120 workers in April to keep up with demands from its private customers and to handle an open-ended government contract to make up to 450 all-terrain cranes for the Army, company officials said at the time.

Franklin County Area Development Corp. Executive Director L. Michael Ross said he talked with senior officials at Grove on Wednesday. Those officials indicated to him that the layoffs would be long-term.

Ross said the corporation will work with the Department of Labor and Industry's Dislocated Worker Unit, the Cumberland Valley Job Center and the Franklin-Adams Job Training Consortium to assist the laid-off employees.

"We want to connect them with the available resources and programs that can transition them into other jobs," he said.

Ross said he's unaware of any ripple effect the layoffs might have outside the company gates. Grove does business with a number of other suppliers and vendors in the area and Grove has a strong backlog of orders to keep local industries busy.

"Grove will continue to be the county's largest employer and the one with the greatest economic impact," he said.

Bonanno, in a prepared statement following Thursday's announcement, hinted that the crane market is not as strong as it was earlier in the year.

"The construction equipment market in North America has enjoyed a very positive business cycle over the last five years. Solid demand combined with Grove Worldwide's strong North American dealer organization has masked recent fundamental changes in market conditions," Bonanno said in the release. "While Grove has a commanding market position today, we cannot maintain our competitiveness without these necessary changes."

"We are sensitive to the impact this restructuring will have on affected employees, but understand that it is essential to position the Grove organization for long-term growth and to deliver on our commitment to excellence to our customer, our employees and the communities in which we operate," Bonanno said.

He said Grove is developing more efficient products and will place more emphasis on after-market parts and service.

Grove also has plants in Germany and France.

The company was started in 1947 by three local men who made farm wagons in a garage in Shady Grove. Kidde Inc. bought the crane-maker in 1967. Hanson PLC acquired Grove in 1987 as part of a $1.6 billion merger with Kidde.

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