A Michigan machine shop goes into receivership this week:
http://www.dexterleader.com/stories/022609/loc_20090226009.shtml
To our readers and forum members in Michigan, how is business out there? Are you remaining shops seeing an increase in business due to economy-induced industry shake out? Is the faltering state of the automobile industry affecting your business in the extreme?
Shitty. No. Yes.
Good to know Masters, but can you elaborate a bit?
I see that Empire Tool is being auctioned online by Hilco starting March 5th to March 12th. Empire was the creme de la creme of cutoff tools for screw machines and made a good shave tool holder and other assorted screw machine holders and attachments.
Who is picking up this business? Who picked up the goodwill and intellectual property? The demise of Empire is a nasty commentary on the state of the screw machine industry today.
On the other hand I found the management of Empire difficult to deal with. They thought their products were gold plated and charged accordingly. They neglected to advertise or participate with trade groups. They stayed in a fading product category too long.
This is not a Michigan issue. Empire had a wonderful franchise . I am sad to see that they are gone.
Now comes word that Fort Wayne Foundry Corp. will conduct a "mass layoff" in June at its Fort Wayne machining division. The effects of the flagging automotive industry are being felt across the midwest.
Some shops aren't seeing an increase in business because others are closing. It doesn't work that way. The faltering state of the automobile industry is squarely to blame. This entire region was built on it and now it's crumbling out from underneath us. There's nothing below to catch us, so we fall into the deep, black abyss of an uncertain future, our hands grasping madly at the air as we fall, hoping to catch something before we hit the ground and go..............SPLAT!
I can definitely understand the tendency to be bleak, Masters, but the faltering state of the automobile industry may represent opportunity. As forum member Lloyd points out in another thread, "as the automotive supply chain dwindles there will be opportunities for the solid survivors to step in where the Delphis and Visteons choked."
Michigan may be economically bleak but from another perspective that represents a lot of opportunity for enterprising machinists and job shops.
You are mistaken. There is no opportunity here no matter how optimistic you want to sound.
As for Empire cutoff tools, there are other firms that are making and providing cutoff tools as good or better. Much like the precision parts industry the tooling market is getting smaller. There remains within the industry a high level of quality and availablity. The real bottom line, Lloyd is that the industry is getting smaller, may we all pray that the U.S. wakes up before this true asset and the people who work in it disappear forever. We can not become a country based on a service economy, if we do we are dead.
Well, we've been hearing that whole 'U.S. is going to become a service economy' line for years, and U.S. manufacturing is still kicking. Even if U.S. auto manufacturing goes away completely (unlikely), there's still a lot going on in this country in aerospace, energy, infrastructure, the list goes on.
Just talked ro one of the biggest multi spindle screw machhine houses in the U.S. They are calling back people and getting much busier. They are even thinking of buying machinery. The {recision Machined Products Assn. says business bounced up 10 per cent in February though the numbers are still depressing. Maybe we have hit bottom but everybody is too shellshocked to notice. Maybe the stock market bounce is saying the same thing.
Yeah, some people say the recession started in 2007, so we could already be at the start of the recovery. Remember how long it took people to acknowledge that the post-2001 recovery had happened? I remember it was 2005 before someone actually said to me "The recovery is here; we're in it."
I often use a friend to drive me to or from the airport. He is an engineer who no longer is in manufacturing but has stiched together a new career of home repairs and livery. He says his driving business dropped like a stone late last year but has rebounded to almost 90 per cent of where he was a year ago for the last 30 days. He thinks he is the canary in the mine shaft as far as predicting shifts in the economy.
That's interesting. Let's hope he's right!
A group called Michigan Future issued a report today saying Michigan must move away from manufacturing altogether to revive its economy:
http://www.businessweek.com/ap/financialnews/D97IE0A80.htm
Thoughts?
Unity Studios is turning a Visteon plant into a movie studio in Allen Park, MI this week, promising 1,000 to 3,000 jobs; and a new battery manufacturer is starting up in Livonia, MI offering 800 jobs (with 6,000 job potential) for a $300 million tax break. All in all, that's a pretty good week for the job scenario in Michigan.
Broach well that is interesting. A movie studio? Is the movie industry going to find an unlikely home in Michigan?
The state economic development folks have been pushing for the movie industry to come here for a while. Last year, Gov. Jennifer Granholm signed the Michigan Film Incentives bill into law, offering up to 42 percent in rebates on film money spent here. It seems to be working. I hope they make some serious movies about the dying auto industry.
Dude, they already made that movie; it's called Gung Ho.
Well I guess that was a comedy.
I forgot about that one. Micheal Keaton at his best too. On second thought, why do I need a movie about the auto industry here? I'm living it!
Maybe Chris Paine should make the sequel to Who Killed the Electric Car in a shuttered GM plant, Close the circle. Maybe it will be about the Volt.
Right, and Neil Young's new concept album about making an old car electric can be the soundtrack.
Today comes word that the Detroit auto show could move out of Michigan:
http://blog.mlive.com/autoblog/2009/04/detroits_auto_show_could_move.html
A sign of things worsening? Is the state really done with automobile manufacturing?
Michigan still fighting, but no longer in manufacturing:
http://www.areadevelopment.com/stateResources/michigan/michigan-state-report-april-2009.shtml
I hear that Empire Tool is now controlled by Ecorse and Doverspike. They bought the key equipment, intellectual property and the name and customer list. Craig Neal of Doverspike says that the new Empire will treat its customers with respect and hopes to win them back after old management's cavalier treatment turned so many people off. We shall see. I wish them well.
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