BY CHUCK VANDENBERG
FORT MADISON – Local economic and elected officials are wrestling today with news of more than 200 permanent layoffs at the Siemens wind blade facility in Fort Madison.
Employees at the plant were notified in meetings late Tuesday and early Wednesday about the company’s decision to offer permanent severance packages to 202 employees.
Kaile Gurney, a Siemens Gamesa spokesperson, said the company informed employees today about efforts to position the Fort Madison plant for the future.
“Siemens Gamesa Renewable Energy informed employees today about efforts to position the Fort Madison plant for future competitiveness,” she wrote in an email to Pen City Current.
“Business volume at this location through the 2018 fiscal year does not support the existing workforce level. While we remain strongly committed to the long-term viability of the U.S. wind market, a difficult decision has been made to adjust the Fort Madison workforce by about 200 employees. As a reflection of the importance of Fort Madison to our business strategy moving forward, we are making a significant capital investment at the plant to install additional blade molds for new wind turbine models.”
Gurney said all affected employees will receive 60 days pay in lieu of notice and approximately 330 employees remain on staff. She said future staffing will depend on the market and product lines.
“Headcount is always based on the needs of the business. We are currently retooling the factories to accommodate additional product lines. With these capital investments and expected increased delivery schedules, we do anticipate some employee recalls later this year,” she said.
An email addressed to Fort Madison Mayor Brad Randolph, Keokuk Mayor Tom Marion, and other local and county officials was sent this morning by Siemens Plant Manager Tony McDowell.
“Dear Mayors Randolph and Marion, Cities of Fort Madison and Keokuk, and Lee County Officials,
I regret to inform you that effective today, January 24, the Siemens Gamesa management team must share a difficult decision with our employees. Unfortunately, our business volume through FY2018 does not support our existing workforce level, requiring a temporary workforce reduction of 202 employees. While decisions that impact our employees and communities are never easy, this decision is necessary to properly size our workforce. All affected employees will be provided a comprehensive package appropriate to their years of service. Naturally, positive changes in the business situation will result in the call back of those employees according to company policy.
I want to reassure you that Siemens Gamesa is making significant capital investments in Fort Madison to reconfigure and retool our factory as we update a product line and install new blade molds. With these capital improvements, we are positioning ourselves for long-term growth. Siemens Gamesa remains strongly committed to wind power in the United States and Canada, and our plants in Iowa and Kansas are critical to our business strategy.”
Randolph said the news was disappointing and hopefully the retooling the plant will allow some of the jobs to return.
“I guess I would just say I’m deeply disappointed. While I don’t understand the business model and changes with the merger, they have to do what’s right for the company,” Randolph said. “It ends up being at the expense of our community in terms of workforce and families and those 202 people that are greatly affected by the layoff. I can only hope that, with what I’m being told in terms of retooling the plant for long-term success, that the layoffs would be relatively short-lived and they can recapture some of those people.”
State Representative Jerry Kearns said he just heard the news this morning.
“It’s unfortunate that it’s occurring and 200 people will be losing their jobs. We can hope it’s a blip,” Kearns said.
“I don’t know…the demand is down and I assume competition is up. They’re aren’t the only makers of blades, but it’s too bad. They’re one of the bright spots of Lee County.”
Joe Steil, Lee County Economic Development Group’s executive director, said they received no communication that the layoffs were coming.
“I had conversations with them when there were some rumors flying around in 2017 when at that point they had announced closing a sister facility in Canada,” Steil said this morning. “I do know even at that point in time sales were in a slump affecting the Fort Madison plant because of reduction in hours. That was a fact and we all knew about that. Speaking for myself, all the coverage on renewable energy and what our federal legislators have to decide is very important and has an effect on Iowa’s investment in renewable energy.”
Steil said he sees the plant working about retooling the facility as a reason to think the plant will not be issuing further layoffs or even closure.
“Being an optimistic person that is not the direction I see it going,” he said. “I think there’s a certain amount that needs to be said about when production isn’t there industries need to staff accordingly. I see that as probably being the situation here. The other thing is that Siemens numbers have historically gone up and down and I look to the future when sales get back where they need to be to drive production and get those workers back that have been displaced.”
Randolph said he was hopeful that there was enough demand in the area to pick up workers.
“Hopefully we have enough of a demand in the area that those dislocated can pick up employment quickly and we don’t have to experience and don’t have to go through people finding another community to work in because of the job climate. With recent federal action with tax reform and corporate taxes we see some responses from local industry in terms of taking some of that tax relief and applying it back into local resources.”
U.S. Rep. Dave Loebsack said the Siemens production has had its ups and downs, but has provided great jobs in Lee County.
“Siemens, as you know, has provided a lot of really great jobs in Fort Madison and southeast Iowa. I recall going to the plant when it first opened when I was first elected. It’s had its ups and downs just like the wind industry itself. Unfortunately in the past, it’s had a lot to do with the inability to extend the wind tax credits in a timely fashion, but now that’s set for the next couple years,” Loebsack said this morning.
“There’s no question its difficult at the moment to make plans given the political instability in Washington, D.C. But I’ll do everything I can to accommodate and provide information to those workers and I just want everyone to know that my office is open to anyone affected there.