Published: August 22, 2006 11:27 pm      

FreightCar workers: Uncertainty has hurt morale

Frustration is growing among workers at FreightCar America’s plant in Franklin Borough, amid uncertainty about the company’s future locally.

Union employees said sentiments at FreightCar range from fears of losing their jobs or accepting contract concessions to anger because of perceptions of how the company has been operated.

Ray Ciotti, Jeff Baxter and Tom Vatavuk – each of whom has more than 15 years of experience working at the plant – said morale has dipped at the Franklin plant.

FreightCar America officials have asked for concessions from the unionized workers in order to reduce costs at the local manufacturing plant.

The workers said they are convinced the company is taking deliberate steps to make production at the plant more difficult. They alleged that the company is doing so to further increase the per-car cost of production at the Johnstown plant compared with sister plants in Danville, Ill., and Roanoke, Va.

“We used to have such high morale there,” Ciotti said. “You had friends that you worked with, and you really enjoyed being there. Now, it’s just all doom and gloom.”

The workers said claims that the Johnstown plant is not as productive as its sister plants are skewed. They said employees here are building rail cars that require more man-hours to complete than the cars being produced elsewhere.

“The Johnstown plant built Danville, it built Roanoke,” Ciotti said. “Now, instead of our sister companies, they’ve become our competition.”

The trio charged that the company is providing the Johnstown plant with lesser grades of raw materials that require more man-hours to be transformed into rail cars.

They said that regular maintenance to necessary equipment is not being performed, at times rendering those tools unusable.

The workers said that while fewer cars are being produced in Johnstown than elsewhere, that is a because of fewer shifts working here rather than lower per-shift output.

FreightCar spokesman Glen Karan said the company does not publish production rates for individual facilities.

During the second quarter ending June 30, corporate records show, the company delivered to customers 4,711 cars – 15 percent of which were built in Johnstown, according to Karan.

Karan said Johnstown wage rates are higher than at FreightCar’s other facilities.

But, he said, “wages are not our primary issue.” The company has asked for a reduction in benefits.

Contract concessions may be the only way to avoid having the local plant close, company officials have said.

If the local FreightCar plant were to shut down, an estimated 500 jobs would be gone with it.

FreightCar has 10 percent of Cambria County’s manufacturing jobs and is the county’s eighth-largest employer.

“The $15 per hour in cost reductions the company is suggesting did not include wages,” Karan said. “Also, the $15 per hour cost reduction the company is asking for would not bring the cost of the Johnstown facility in line with our other facilities. It would bring them closer and (make them) more competitive.”

The local workers said the company hastily worked to get into place the very contract from which it is now asking for concessions.

Franklin Local 2635 of the United Steelworkers of America, which represents about 450 employees at the plant, signed the 31/2-year contract in November 2004.

FreightCar was transformed into a public company with a stock offering in April 2005, when it joined the Nasdaq listing.

“They gave us a contract just to get onto the market,” Vatavuk said. “Everyone knows that. I think they should at least live up to it.”

John Carroll, president and CEO of FreightCar, said the workers’ claims are unfounded.

On the topic of supplying lesser quality materials to the Johnstown plant, Carroll said, “We are building cars at four plants, and we buy our raw materials from the same sources for all plants. To suggest we have any different quality of materials for the Johnstown plant is not true.”

Carroll also said the company performs the same level of maintenance on its equipment at all of its plants.

In addition, he said, it is taking the Johnstown shop longer to produce a car because of inherent inefficiencies – such as 50 minutes of paid downtime per eight-hour shift.

As far as asking for concessions from a contract that was agreed to less than two years ago, Carroll said times have changed.

“That was then and this is now,” he said. “We’re going to live with the contract we have in place until the end of the contract.”

FreightCar last month announced its strongest-ever quarterly earnings, at $36.6 million.

Carroll said employment at the Franklin plant has decreased this year by about 50 workers. He said those losses were due not to layoffs, but rather to retirements and terminations for just cause.

“We just want to save the jobs,” Carroll said. “If they don’t want to save the jobs, they don’t have to. Nobody is forcing them to take this deal.

“But there’s no question we are trying to save jobs here and avoid closing the plant. If we were going to close the facility, we would have done so a long time ago.”

Baxter and the other workers don’t see it that way.

“I’ve done every job imaginable to make a living,” Baxter said. “I’d trade anybody jobs. This is by far the worst I’ve been treated.”



1852: The Cambria Iron Co. is formed. It soon becomes the nation’s largest iron and steel plant. After being destroyed in the 1889 Flood, the plant is rebuilt.



1901: The Cambria Steel Co. is formed and builds its first freight car. First order filled is for mine cars.



1916: The plant is acquired by the Midvale Steel and Ordnance Co., which in 1923 becomes part of the Bethlehem Steel Co. Eventually, the company became known as the “Freight Car Division.”



1925: The capacity of the Cambria Plant is increased to 1,500 cars per month.



1950: Plant sells the first do-it-yourself kits of car bodies and underframes that are purchased by railroads and assembled in their shops.



1974: The shops are equipped to build hopper cars, gondola cars, ore cars, flat cars, mine cars and special-purpose cars by mass production methods. Production reaches 50 cars per 24-hour period.



1990: The volume of cars manufactured in Johnstown reaches a historical peak when CSX Corp. of Jacksonville, Fla., places an order for 550 high-side Coke cars. That same year, the log-hauler prototype – a 70-foot log-hauling car designed to transport whole trees from the woods to a manufacturing facility – is built in Johnstown.



1991: The Freight Car Division is acquired by Johnstown America Industries Inc., and the aluminum car product line is expanded.



1995: Johnstown America acquires Freight Car Services in Danville, Ill.



1996: International sales capabilities are introduced for new freight car and railcar kit orders delivered to customers in South America.



1999: Johnstown America becomes an independent freight car builder.



2004: The parent company of Johnstown America Corp. changes its name to FreightCar America Inc.



2005: FreightCar America completes its first public offering of common stock and is listed on the Nasdaq.



Source: FreightCar America Web site