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Some jobs saved as GST plant ceases production

January 30, 2004|by JULIE E. GREENE

julieg@herald-mail.com

Today will be the last full day of production at GST AutoLeather's local cutting operation, the company's president said Thursday.

Company President Mark Lecher said the automotive leather manufacturer will lay off almost a third fewer employees than originally anticipated.

He announced an approximately $750,000 upgrade to the materials lab at the retanning and finishing operation on Clear Spring Road.

Company officials wanted to keep as many people actively employed in the local operation as they could in a business that has become globally competitive, Lecher said. The retanning and finishing plant has 526 employees.

GST AutoLeather, formerly known as Garden State Tanning Inc., is laying off 158 people instead of the originally anticipated 225, so 67 people will stay with the company, Lecher said.

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The lab investment and 67 jobs saved come after a difficult few months for GST AutoLeather.

It was announced in November 2003 that the cutting plant on Governor Lane Boulevard would close.

Then, on Jan. 21, Deanna L. Stottlemyer was killed in a job accident in which she got caught in one of the rollers on a hide-coloring machine. Maryland Occupational Safety and Health officials are investigating the accident.

Lecher said the close-knit community of workers that helps make GST AutoLeather a good company has "helped us heal as a company because everybody's been affected."

That the company can keep more of those workers and invest and grow is exciting news, Lecher said.

Hagerstown-Washington County Economic Development Commission Executive Director Timothy R. Troxell said he hopes the investment in the research and development lab will help retain a higher number of employees at the Clear Spring Road operation.

Government help


The company is getting a $350,000 funding package from the county and state toward the $750,000 lab upgrade, Troxell and Andrea Harrison, spokeswoman with the Maryland Department of Business and Economic Development, said.

Last November, Lecher announced the cutting plant on Governor Lane Boulevard would be closed and that work would be sent to two plants in Mexico, where labor is cheaper. The cutting plant in Saltillo employs about 1,000 people and the one in Nuevo Laredo, which opened in December, employs 230 people, Lecher said.

While GST officials didn't say there were plans to close the Clear Spring Road retanning and finishing operation, Troxell said economic development officials wanted to give them good reason not to close.

"Obviously, we're disappointed that there are some people that are losing their jobs totally, but the other side of that is we are happy that the company is making further investments in the manufacturing plant, and some of those people that thought they weren't going to have jobs are going to be placed there," Troxell said.

GST's retanning operation in Reading, Pa., will close next week, with most of the plant's 90 employees being laid off, Lecher said. The company still has a finishing operation northeast of Reading in Fleetwood, Pa., that employs about 300 people.

Troxell said economic development officials knew the company had some kind of plan in the works regarding its Pennsylvania plants and wanted to make sure the company made the lab investment in Maryland and not in another state.

Maryland government is providing the company a five-year, low-interest loan for $250,000 and a $50,000 conditional loan that could convert to a grant, Harrison said.

The county is providing a $50,000 conditional loan that could convert to a grant, Troxell said.

The conditional loans would convert to grants if the company maintains 26 permanent, full-time jobs in the research and development lab area through Dec. 31, 2008, Troxell and Harrison said.

Better leather


The lab will conduct tests from product development through commercial production to make sure the automotive leather looks as good three years after it's installed in a vehicle as it did the day it was installed, Lecher said.

The lab upgrade could be complete in early May, Lecher said.

Today, 120 workers will leave the cutting plant, with a handful of employees staying to clean up and finish a few jobs, said John O'Malley, GST's vice president of global human resources. Of those 120 workers, 73 will return to work at the Clear Spring Road plant.

Cutting plant employees with enough seniority had the option of transferring to the retanning and finishing plant and bumping someone else's job. However, one-fourth of the 158 people being laid off decided to take advantage of additional unemployment benefits provided through the state and federal government, O'Malley and Lecher said.

Because the local workers' jobs were lost to international trade, those employees could be eligible for their unemployment benefits to be extended to two years if they are in job retraining, said Patrick Baker, state dislocated worker trade unit manager.

Cleanup at the cutting plant building is expected to take about two weeks, company officials said.

Lecher said the company is working with economic development officials to help recruit a business that could use the 100,000-square-foot building and create jobs in the community.

GST, which has more than a year left on its lease for the building, could sublease the building, said Rich Hoban, chief operating officer for Bowman Group. Bowman owns the building.

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