Volume 40,   Issue 7                                  July 2005

NewsNow

AFG Closes Concord, Ontraro Plant;
Undergoes "Aggressive" Restructuring

As part of its restructuring and reorganization efforts, AFG Industries has announced plans to close plants that have not been profitable.

The announcement, which came June 2 in a video presentation from president and chief executive officer John Litzinger described an “aggressive” strategy in which restructuring efforts would attempt to cut costs by at least 10 percent. Additional reorganization has already occurred with the introduction of automated machines that stack and move glass within the plants, eliminating the need for some manual labor. 

Through these efforts, the company’s AFG Fabrication business is closing its Concord, Ontario., facility August 12. Frank Davey, executive vice president of AFG Canada Ltd. and general manager of the facility said, “For the past 35 years, our Concord plant has served the glass needs of the commercial construction market in North America and abroad. Unfortunately, with the decline in the commercial construction market, and changing performance and service requirements, we have not been able to maintain our financial viability.”

Davey continued, “The period until the end of August will provide us time to complete all current jobs under contract. Projects under discussion can be converted to AFG’s Comfort Ti family of commercial products. AFG Coatings has three sputter-coaters in the United States, which produce the contemporary layer stacks required by energy codes and architects, including second-surface tints and post-temperable coatings. 

Our fabrication of commercial products has been moving to regional ‘mega centers’ that can provide quicker service to local glazing contractors. Over the past five years, the lead-time component of our business has been getting shorter and shorter. Concord simply could not compete in this environment.”

“Exchange rates, shifting coating technologies and high costs,” added John Stilwell, vice president of AFG Fabrication North America, “have forced us to eliminate our under-performing operations in order to strengthen our overall financial performance and customer service in North America. We are very proud of our employees and the products they produced, and regret that this has become necessary.”

The Concord plant was built by Pilkington in 1970. It was sold to Ford Glass Division in 1980 and to AFG Industries in 1988. AFG Fabrication continues to operate 14 fabrication, distribution and glass shops in Canada along with the AFG Glass float plant in Quebec. There are no plans to close any U.S. plants.

Pilkington’s Illinois Plant Undergoing Repairs
Pilkington North America’s Ottawa, Ill., plant is undergoing a four-phase repair to a 500-ton-per day glass melting furnace. According to Pilkington, $11 million has been put toward the first two phases of the repair. 

In phase one, which is already complete, a new propane firing system was added to the furnace. Phase two, which is in progress, will include the addition of a new furnace cooling water system and a new site power supply. Todd Huffman, Pilkington North America vice president of strategic planning, said phase two will be complete by the end of this calendar year. A new batch house and a furnace replacement will be added as part of phases three and four.

Huffman said phases three and four are not expected to begin before 2008. 

“We’re always evaluating the units to see if they can [be in operation] longer,” said Huffman.

He explained that phase one and two repairs are having only a minimal effect on daily operations. 

“We [want the repairs] to be transparent to daily production routines,” Huffman said.

During cold repairs, he added, the furnace would have to be shut down a certain amount of time in order to replace the equipment.

If all four phases are carried out the repairs will total a $60 million investment. 

On June 14 Industrialinfo.com had released a web article stating that Pilkington was deferring the Ottawa plant rebuild until 2010, but cited no source for the story. Huffman said the news site’s information was incorrect and that the repairs were still in progress.


USG
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