Chowchilla plant laying off workers

The Brake Parts Inc. manufacturing plant in Chowchilla expects to lay off up to 90 people in mid-November, company officials confirmed Thursday, but city leaders say they’re planning a pitch to keep the jobs in town.

The McHenry, Ill.-based company, which refurbishes brake parts for cars and trucks, can do the work at a fraction of the cost at its plant in Nueva Laredo, Mexico, according to Randy Clausen, vice president of global human resources.

“We’re just trying to make the economics work,” he said.

The Mexico plant is located just over the border, about 150 miles west of Corpus Christi, Texas. Clausen said Chowchilla workers were notified about two weeks ago and the company has no plans to close the plant entirely.

The company receives used calipers from auto parts stores and rebuilds them. Clausen noted that many of its competitors have plants in other countries where it’s cheaper to produce goods. “It puts us at a competitive disadvantage,” he said.

Officials would not say how many people currently work at the plant at 711 South Third St. in Chowchilla. They noted that 90 layoffs would be the ceiling, and that the number could be smaller.

“We certainly don’t like the idea of people losing their jobs,” plant manager Russell Raymond said. “We certainly wish them the best.”

He said employees will be offered severance packages and the company is working with Madera County workforce officials to help those laid off find new employment.

Losing as many as 90 jobs would be a tough blow to a town of about 17,000, said Steven Gutierrez, a labor market analyst with the state Employment Development Department in Fresno. “That’s going to have a pretty significant impact on the local economy,” he said.

He noted that those layoffs would come just before the end-of-the-year holidays, when many people are ready to use their expendable income at retail stores.

Unemployment numbers typically start to rise this time of year, Gutierrez said, but that’s more commonly related to the end of seasonal farm jobs. The unemployment rate in Chowchilla is 8.8 percent, higher than the state average, according to EDD’s most recent report from August.

Bobby Khan, executive director of the Madera County Economic Development Commission, said the county’s manufacturing industry has grown in recent years.

A surge in manufacturing activity in the past couple of years propelled Madera County to the unlikely top spot in a national ranking for manufacturing job growth among not only small metropolitan areas, but all metro markets in the country, according to a report from August.

The economic development blog NewGeography.com analyzed metro areas nationwide, factoring in short-, medium- and long-term job growth in the manufacturing industry. Its analysis ranked Madera County first among 210 small metro areas, defined as markets with fewer than 150,000 jobs. Madera County’s weighted index of 74.4 also placed the area tops in manufacturing job growth among all 421 metro areas across the country, regardless of size, the blog’s analysis found.

Regardless of that achievement, Kahn said losing jobs in small communities has a large ripple effect on the other industries in town. “Our communities are relatively small,” he said. “Living-wage jobs are at a premium.”

Kahn and Brian Haddix, Chowchilla’s city administrator, are working up plans to try to retain the jobs in Chowchilla. Kahn said there are likely savings in energy costs, tax credits, training and other incentives he could present to the corporation.

Haddix said most of the company’s employees are Chowchilla residents. He said city leaders “won’t roll over.”

“Plan A is to fight for every job I can,” he said.

This story was originally published October 15, 2015 at 5:23 PM with the headline "Chowchilla plant laying off workers."