Relocation cuts 160 jobs

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May 31, 2008
— Already punched by expected job losses in its automotive sector, Janesville’s economy took another blow Friday when a long-time manufacturer announced it would close its plant and eliminate more than 160 family-supporting jobs.

ThyssenKrupp, the local manufacturer best known in Janesville as Gilman, said it will move its local operation to Auburn Hills, Mich., by the end of September.

In Janesville, the company operates two divisions in its 200,000-square-foot facility on West Delavan Drive. The building will be sold.

ThyssenKrupp Krause develops, designs and manufactures powertrain systems, including components for the manual, semi-automatic and automatic assembly of engines, transmissions, axles and subcomponents for automotive manufacturers.

It employs 55 mechanical and electrical engineers in Janesville. Nine will be offered transfers to Auburn Hills, and 13 sales and service personnel will remain in Janesville.

The second division, ThyssenKrupp Drauz Nothelfer, supplies production plant systems for the assembly of automotive bodies, including laser welding systems and metal forming equipment.

It has 120 engineers, technicians and administrative personnel in Janesville, 12 of whom will be offered transfers.

Company officials said the consolidation to Michigan will improve competitiveness and cost efficiencies in what’s become a highly competitive auto industry.

“The Detroit area is a central area for auto manufacturing in this country, and in order to increase our stake in the U.S. auto market, consolidation there makes sense,” said Matt Rhodes, a company spokesman in Washington, D.C.

John Bandsma, the company’s vice president of finance and administration in Janesville, said the move to the Detroit area will make it easier for customers to visit the company.

In Janesville, the company employs a variety of well-paid engineers and assemblers who make an average of $20 per hour in wages. Bandsma said local employees have highly technical qualifications and unique skill sets, which the company’s salary scale reflects.

“This is a tough one for the community,” said City Manager Steve Sheiffer. “This is a long-term company with outstanding employees.

“It’s a further indication of the consolidation that’s occurring in the auto industry.”

Sheiffer said the high-paying jobs will be difficult to replace in the short term, but he’s confident that the community will bounce back from these and other job losses.

John Beckord, president of Forward Janesville, said a large portion of the company’s local workforce is knowledge-based, particularly in the engineering areas.

“My hope is that we can retain as many of these people as possible and that many of them will stay in the community and maybe start new businesses,” Beckord said, adding that Forward Janesville is willing to help displaced workers do just that.

“These were high-level, high-paying jobs that carried a lot of knowledge. We have a history of entrepreneurial start-ups in Janesville.”

About 75 workers at the company are represented by Local 1266 of the International Association of Machinists and Aerospace Workers.

“These are skilled assemblers who work in a highly specialized business,” said Ivan Collins, Local 1266’s president. “Most of them have 20-plus years there.”

George Gilman Sr. started the company in 1936 with the production of small lathes.

The company has changed owners and names several times, and workers have said privately for months that they expected Friday’s announcement. When one of the divisions dropped Gilman from its name last year, union employees sported t-shirts that said “Still Gilman at Heart.”

In recent years, many long-time employees left the company, frustrated with the direction management was taking it.

“It is sad to see how bad management decisions and bad owners have systematically destroyed a local company with a 72-year history,” a former Gilman employee said on the Gazette’s Web site shortly after news of the closure broke Friday.

“It has been one poor management decision after another that has caused Gilman to be pigeon-holed into the automotive industry. … As the employees have always said, the definition of insanity is doing the same thing over and over and expecting different results. And, as we can see, the results are the loss of 170 good manufacturing jobs and a company that was an innovator in the world of automation.”

Bandsma acknowledged that the company has lost many long-time employees in recent years, particularly as the auto industry constricted and workers sought other growth opportunities in industries that offer better job security. He said, however, that the decision to consolidate in Michigan was made after a careful analysis.

Internal rumors and speculation reached a crescendo this week, he said, and employees at the plant were somber after Friday’s announcement.

“I don’t know how great a surprise it was, but when reality hits people, they’re shocked,” Bandsma said.

Rhodes said the company will work with state agencies and employees to ensure eligibility for unemployment benefits and job retraining and placement programs. Collins said the union will try to negotiate a severance package.

The ThyssenKrupp Group, based in Duesseldorf, Germany, is a global technology company that operates in five segments: steel, stainless, technologies, elevator and services. It employs about 191,000 in 70 countries and most recently posted sales of $68.7 billion.


1936: George Gilman Sr. starts Gilman Engineering Works in Janesville to produce small lathes.

1941: Gilman shifts production to make fuses to support the U.S. war effort.

1946: The company is renamed Gilman Engineering and Manufacturing and moves from North First Street to its current location at 305 W. Delavan Drive.

1948: Parker Pen acquires Gilman to design and build automatic assembly systems.

1963: Gisholt Machine Co. of Madison buys Gilman.

1966: Giddings & Lewis of Fond du Lac acquires Gisholt.

1982: AMCA International acquires Giddings & Lewis, and the Gilman operation in Janesville is renamed Gilman Assembly Automation.

1989: AMCA sells Giddings & Lewis, and the local operation is renamed Giddings & Lewis Assembly Automation.

1997: ThyssenKrupp buys Giddings & Lewis.

1999: The local operation is aligned with the Johann A. Krause division of ThyssenKrupp and is renamed Gilman Engineering & Manufacturing, ending a 34-year run with Giddings & Lewis.

2003: Gilman is divided into two separate divisions: assembly automation and structural systems.

2005: The assembly automation division becomes known as Johann A. Krause, while the structural systems division is renamed NothelferGilman.

2006: The Johann A. Krause division is renamed ThyssenKrupp Krause.

2007: The NothelferGilman is renamed ThyssenKrupp Drauz Nothelfer.

2008: ThyssenKrupp Krause and ThyssenKrupp Drauz Nothelfer announce that they will close their operation in Janesville and consolidate in Auburn Hills, Mich.

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