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Grove lays off 260

September 08, 2000

Grove lays off 260



By RICHARD F. BELISLE / Staff Writer


SHADY GROVE, Pa. - Grove Worldwide announced the immediate layoff of 260 workers Friday.

Jeffrey Bust, Grove chairman and chief executive officer, blamed the cutbacks on poor third-quarter earnings. He said in prepared remarks that sales of the company's Manlift line are suffering significant losses this year.

Grove manufactures hydraulic cranes and Manlifts, or mobile aerial work platforms. It employs more than 2,400 people.

Bust said the crane business is seeing increasing sales.

The layoffs, which are across the board, will eliminate a plan implemented in August that had workers on the job for three weeks followed by a week off without pay.

The reduced work schedule will be stopped effective Monday. Most shop areas will operate a two-shift rather than a three-shift schedule.

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The company had also sought voluntary pay cuts from all of its employees. There was no announcement Friday regarding the pay cuts.

The company will not shut down its Manlift production line from Nov. 17 through the end of the year, as was announced in August.

"My commitment to our lenders is to resolve the problems in the Manlift business and improve the efficiencies of our Shady Grove operations in short order," Bust said in his statement.

Grove's plan to sell its Technical Training Center in Blue Ridge Summit, Pa., also announced in August, is still a go, Keith Simmons, senior vice president, said Friday.

The training center opened in 1981 to host visits of large groups of distributors and potential customers and as a place to train buyers to use Grove equipment. The center also provided lodging and dining facilities.

The training facility and its employees will move to the main plant in Shady Grove, Simmons said. Those involved in food and lodging services will be phased out.

Seniority as well as qualifications, skills, job performance and ability were considered in deciding which employees around the plant were laid off Friday, Simmons said.

"There are areas in which we must retain critical skills, such as welding and machining. Therefore some individuals who have less overall seniority will be retained," he said.

Simmons said the layoffs will be permanent.

Mark King, an analyst with Standard & Poors' in New York City, which has been rating Grove since April 1998, said Friday that Grove is a small player in the aerial platform industry and as such its performance in the market is weaker than that of industry giants such as JLG Industries in McConnellsburg, Pa.

Bust said Grove is exploring partnerships with other aerial platform manufacturers to strengthen its position in that market. The company is also considering increasing Manlift profits by cutting production and reducing sales, engineering and administrative costs.

King said that while Grove's performance in the aerial platform market is a drag on the company's performance, its overall prognosis looks good because of its strength in the crane business. He said Grove is a respected company that is showing profits in its domestic and international markets.

"It should be OK," he said.

"We've developed 15 new crane models since March of 1999," Simmons said.

Bust called Grove "a company in transition." He said the company has taken many steps to improve the operations at Shady Grove, its headquarters and main manufacturing plant.

"We are not alone in the industry in feeling the effects of sales slowdowns and we are taking necessary actions to maintain company strength," Bust said in his statement. "We will continue our efforts to return to profitability and to ensure the future of Grove."

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