The Tribune Democrat, Johnstown, PA

November 27, 2009

Gamesa layoffs a surprise

By KATHY MELLOTT

EBENSBURG — Gamesa USA’s decision to furlough more than half its employees at the local turbine blade plant came as a surprise to many. But Gov. Ed Rendell remains optimistic the action is a bump in the renewable energy journey, a spokesman said Friday.

“The company is still committed to its employees and its Ebensburg plant,” Rendell spokesman Michael Smith said, echoing a company statement.

Smith cited significant improvements in the Cambria Township manufacturing site as key indicators Gamesa will remain a viable employer in the region.

“Gamesa has made a $200 million commitment in the commonwealth since it first set up shop here,” Smith said of plants in Cambria and Bucks counties.

Opened in 2006, the local plant manufactures blades for wind turbines for Gamesa, a leading windmill producer worldwide.

On Wednesday, the Spain-based company said it is furloughing 141 workers from its 238-member union bargaining unit. Voluntary buyouts are being offered to 62 of the employees, while 79 were placed on temporary layoff.

No one from Gamesa or the United Steelworkers of America Local 2635 is estimating when workers will be called back.

“It’s a temporary action on the part of the company brought about by the national recession. Gamesa, like every other company, is not immune,” Smith said.

Gamesa spokesman Michael Peck said Wednesday the worldwide recession has reduced energy consumption, forcing power companies to purchase fewer agreements with wind farm developers.

The layoffs were a surprise for Cambria County leaders, who remain hopeful the move is temporary.

“I was somewhat shocked because they had orders through 2011,” commissioner Chairman P.J. Stevens said Friday. “I hope it’s temporary.”

Longtime industry watcher Ron Budash is optimistic.

“They are retooling this plant and they’re still looking for expansion here,” Budash said.

“They’ve made a commitment to this region.”

Budash is a former executive director of the Cambria County Industrial Development Corp.

He serves as a county consultant and operates a private firm, Pine View Consultants.

Gamesa said in July that the plant would close during December to be retrofitted. It was to be back in operation in January.

Budash said the company is looking for land to store the huge blades and rail sites for shipment, including a siding near Mine 33 and a staging area around Cresson.

“In the past, there were downturns in the steel and coal industries. You have these peaks and valleys,” he said.

Stevens discussed the effects of the furlough.

“In the short term, a lot of people are impacted by Gamesa’s work-force reduction,” he said.

“Not only does it hurt the families of these employees, but there is a spinoff in the economy as well.”

The Gamesa plant in Ebensburg was made possible through $9.3 million in state assistance.

When plans were announced to build the factory in 2005, Rendell said the plant was one of the most significant economic development announcements in decades in the Johnstown area. He said it represented a significant turnaround, with Pennsylvania luring high-paying manufacturing jobs from overseas.