Union: Dematic’s potential move to Mexico ‘a slap in the face’


GRAND RAPIDS, Mich. (WOOD) — Around 300 people could lose their jobs if Dematic moves forward with plans to relocate its manufacturing plant in Grand Rapids to Mexico.

In a press release issued Wednesday, Dematic said it is considering plans to close its manufacturing plant on Plymouth Avenue in Grand Rapids over the next year in an effort to “remain cost competitive” for its customers.

“Dematic is a global company and we have over 5,000 employees worldwide. Although a decision hasn’t been made at this point to move, we’re continuously looking at our cost structure and part of that is a response to the market dynamics to improve quality, safety, delivery and cost, said Robert Arguelles, the executive vice president of global operations.

Dematic said if the plan is implemented, most production activities would be transferred to its facility in Monterrey, Mexico, over a six to nine month period, likely beginning in early 2016.

If a decision to relocate is made, the closure of the manufacturing plant could impact as many as 300 positions in fabrication, assembly, warehouse, and plant administration, according to the company’s news release. Dematic said no other positions would be affected including sales, engineering, solution development and customer service.

“Nine-hundred jobs would be staying here. We don’t want to lose 300 jobs obviously, and they are good-paying manufacturing positions. We’ve worked with the company for many years. We are going to try to work with the company and see if we can help them in any way to stay here in collaboration with the city of Grand Rapids,” said Birgit Klohs, president and CEO of The Right Place.

Klohs said it’s not a trend that other manufacturing companies would follow.  Klohs told 24 Hour News 8 the industry has been growing over the years.

“So this would be a talent retention effort- to make sure that those 300 folks… get placed as quickly as possible,” Klohs said.

UAW Local 1485 President Scott Wahlfeld said employees were informed Wednesday morning by company leaders about the potential move.

Wahlfeld said Dematic will consider finalizing the decision on Feb. 8.  If approved, the move would start March 11, Wahlfeld said.

“The union is going to fight. We’re going to fight, we’re going to negotiate, we’re going to try and get them to stay. That is our job –  to keep our people here in Grand Rapids working, but it’s up to them,” Wahlfeld said.

Walfeld received a letter from Dematic just before the announcement was made, stating that they are contemplating the relocation “purely for economic reasons” and that it “is in no way related to the Union.”

The letter went on to read that Dematic “does not believe there is an obligation to bargain over the relocation decision” and that “based on Monterrey’s overwhelming economic advantages, we do not see how the Union could offer any concessions that could make, by comparison, Grand Rapids manufacturing competitive.”

“In that letter, we simply stated what we felt was the current state, but it’s not a forgone conclusion. That’s why we’re offering our partners the authority to enter into the decision,” said Arguelles.

“It’s greed, it’s corporate greed. That’s what driving corporations in America today and it doesn’t matter what their employees, or the people that (sic) actually do the work to make the money, it doesn’t seem to matter to them, it’s all about the money. It doesn’t surprise me that corporations in America are doing this,” said Wahlfeld.

Wahlfeld told 24 Hour News 8 that Dematic made a similar threat the last time the union contract was up about seven years ago, saying it would move operations to another U.S. facility if the contract was not approved. Wahlfeld said employees made big concessions to convince the plant to stay.

“Not kind of – [it’s] definitely a slap in the face. It really, really is. Not only is it a slap in the face to the membership that works here, but to their families, to their children,” Wahlfeld said.

According to Dematic’s website, the company is a global supplier of integrated automated technology, software and services.

*Editor’s Note: The article originally quoted the UAW local president saying that if the decision to move went through, 305 union workers would lose their jobs, as well as a thousand or more other non-union, staff members. Dematic corrected that statement saying as many as 300 positions would be impacted and no other positions would be affected. The correction is reflected in the article.

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