The Buffalo News, November 4, 2009, Wednesday

The Buffalo News

November 4, 2009, Wednesday

The Buffalo News

After bankruptcy slog, Delphi regains traction
Reacquired by GM, Lockport plant feels relief, optimism as it re-emerges

By Matt Glynn

For employees of Delphi’s Lockport manufacturing plant, the last four years were dominated by the company’s bankruptcy case.

That changed a month ago, when Delphi finally emerged from Chapter 11 protection and General Motors reacquired the Lockport plant.

To Pat Curtis, manager of the Lockport plant, the switch to GM was more than symbolic for the 1,400 hourly and salaried employees. The workers felt “a lot of anxiety” during Delphi’s protracted bankruptcy, he said, and there now is a sense of relief.

“There’s optimism. I think the morale of the team has improved,” Curtis said in a Tuesday conference call about the Lockport plant’s transition.

The Upper Mountain Road site was placed into a new subsidiary formed by the automaker, GM Components Holdings LLC. Delphi Holdings LLP, as it is known post-bankruptcy, continues to run a technical center with 200 employees at the Lockport complex in space leased from GM.

The Lockport manufacturing site, which makes thermal products such as climate-control systems, has proved a survivor. It was one of the few plants that Delphi chose to keep while it was selling off or closing others. GM then agreed to reacquire the operation, saying that what it makes is vital to the automaker’s business. The plant had left the GM corporate family when the Delphi parts division was spun off a decade ago.

GM’s newly created subsidiary contains the Lockport parts plant and three other sites in Rochester; Wyoming, Mich.; and Kokomo, Ind. The automaker formed a separate subsidiary for the steering business that it took back from Delphi. GM said Tuesday that it will use $1.1 billion of its government aid to acquire those businesses.

While Delphi slogged through bankruptcy for years, GM has had its own struggles, coping with a dismal U. S. car market and going through a bankruptcy filing earlier this year.

But Bill Shaw, GM’s general manager of GM Components Holdings, said the Lockport plant can grow under its new affiliation by supplying products for popular vehicles and making itself more competitive to attract more business.

The plant needs to pinpoint ways to reduce costs, Shaw said. “[Curtis] and his team have already done a lot of homework on where they need to take waste out of the operations,” he said.

GM will implement its Global Manufacturing System at the newly acquired operations, Shaw said. The system emphasizes areas such as employee involvement, quality expectations and faster delivery times.

Shaw is familiar with the region and its connection to the auto industry. He held leadership roles at the company’s plants in the Town of Tonawanda and St. Catharines, Ont., and was previously manufacturing manager for the engine sector of GM Powertrain.

Curtis, who has served as the Lockport plant manager for a year and a half, said the site provides a lot of product volume for the Buick LaCrosse, a luxury sport sedan, and will also supply a lot for the Chevrolet Cruze, a compact car set to begin production next summer in Lordstown, Ohio.

Art Wheaton, director of labor studies for Cornell University’s School of Industrial and Labor Relations in Buffalo, said the Lockport plant’s shift back to GM was good news for the operation.

“I don’t think the long-term future for Delphi manufacturing in the United States is very good at all,” Wheaton said, noting that most of its manufacturing is now in other countries.

Wheaton said GM has a keen interest in ensuring that the air-conditioning systems in its vehicles are top-notch, both for energy consumption and the comfort of the vehicle occupants. Riders will be affected if the systems are not up to par, so the Lockport plant is well-positioned to address the automaker’s needs, he said.

Curtis said that only 1.6 million of the Lockport complex’s 2.8 million square feet are in use. The company has no plans to sell the unused space, which he said is kept in “cool storage” should the company need to expand into more space.

mglynn@buffnews.com