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Article published May 17, 2009 DENSO weathers storm: Blount car parts maker gets by despite auto industry woes Blount car parts maker gets by despite auto industry woes
By Robert Norris of The Daily Times Staff
"It Could Be Worse!" is the title of a children's book by James Stevenson.
It could also mirror the glass-half-full optimism of automobile parts manufacturers in Blount County.
They've struggled as Detroit automakers fight for survival -- but not nearly as much as some others in Tennessee and the Southeast. To illustrate the hard times facing the car business, a national economy story by the Associated Press last week focused on the town of Linden, located in Perry County about 70 miles southwest of Nashville and along the Tennessee River.The AP story line was this: "Auto industry upheaval is devastating local economies across the Southeast, forcing layoffs at factories that make car parts and driving some counties' unemployment rates far higher than the national average."
The Blount County unemployment rate for March was 10 percent. The national rate was 8.9 percent. Perry County's rate? A state high of 24.5 percent, fourth highest of any county in the United States. Perry's loss of 800 automobile part manufacturing jobs over the past two years is a major reason for that.
Blount County car parts makers have fared better during the downturn.
"I think all things considered, they have weathered it well," said Bryan Daniels, executive vice president of the Blount County Industrial Development Board.
He said their success is largely due to a diversity of products and customers. But still, they've been hit hard.
"They've cut back, as anybody does, in order to survive," Daniels said.
That includes the kingpin of auto parts manufacturers in the county -- DENSO Manufacturing Tennessee. DENSO is the county's largest employer with about 2,500 employees. The company has adapted to the auto industry slump by reducing the workweek hours of production employees and with pay cuts for salaried employees.
In response to a Daily Times request for thoughts from DENSO on how the company is managing to deal with the shaken economy, Mike Brackett, vice president and treasurer, provided the following statement:
"The current economic downturn has had a big impact on DENSO Manufacturing Tennessee's business. However, the impact has been mitigated somewhat by several factors. Even during the best of economic times, DENSO has focused on: (1) maintaining a lean organization with an emphasis on continuous improvement, (2) diverse customer and product bases and (3) flexible long-range business plans that can be modified with changing economic conditions.
"DENSO's most critical strength has remained constant during times of strong customer demand or in the case of this industry downturn -- our associates. DENSO's associates have shown great creativity and dedication in developing and implementing cost-reduction ideas to keep the company as stable as possible. Some actions taken by the company, such as reduced work schedules and reduced salaries, have been painful for our associates. Other cost-saving efforts, such as reducing energy consumption, minimizing travel and eliminating color copies may seem minor on their own, but contribute significant savings when combined.
"The economic crisis is global and impacts more than just the auto industry. The auto industry as a whole continues to face major challenges. We do believe that the companies that survive these tough times will emerge as stronger organizations with bright futures.
"DENSO Manufacturing Tennessee is committed to doing everything possible to maintain business and employment stability during this difficult time and prepare to take advantage of the opportunities that may arise when the economy and automotive market improve."Back to Linden
The AP story continues: "Along Main Street and side streets, the pace of life has shifted from idyllic to idle. In Linden, the county seat, 'For Rent' signs hang outside empty storefronts where cafes, clothing stores and beauty parlors once prospered serving auto parts plant workers and their families. Amid rolling hills dotted with cattle and modest ranch-style homes, the unemployed residents of Perry County -- like Banks -- are passing the time by tending their yards and raw emotions."
Gov. Phil Bredesen was in Linden on Friday to announce a plan that would bring 300 jobs to Perry County,
"They need a paycheck on Friday, not hope that things will get better in the future," Bredesen said at the announcement, which attracted a crowd of nearly 300 people. State officials started taking job applications immediately.
The new positions include government and private sector jobs that will be funded by the American Recovery and Reinvestment Act and other federal funds through September 2010. Bredesen said he wants to use as much as $400 million in the stimulus money to fund the new jobs.
It's all in response to a county where one in four is unemployed -- a place where nearly half the county's work force of 3,000 worked in the auto industry in 2000. Today, that's down to less than 5 percent.
Not exactly a children's story, but a cautionary tale -- "It Could Be Worse."