LM Glasfiber GM: Plant In Line with Original Expectations

LM Glasfiber GM: Plant In Line with Original Expectations
LM Glasfiber's North American vice president and general manager says the fiberglass wind blade-maker is adjusting for projected growth that didn't come.

LM Glasfiber's North American vice president and general manager said Tuesday that the fiberglass wind blade-maker is adjusting for projected growth that didn't come and is now back to its original plans for Little Rock.

Randy Fox said an interview with ArkansasBusiness.com that he's confident the Danish company will meet or exceed employment commitments its made with the city and state, including employing about 1,000 workers by 2014.

"We're positioned very well," Fox said. "We believe in this industry. It's going to come back and when it does, we're going to be positioned very well to take advantage of that and to expand here in Little Rock."

Earlier Tuesday, the company announced it would idle one of its two Little Rock plants and lay off 150 workers. The firm, which will employ more than 350 people in Little Rock once all adjustments have been made, blamed the credit crisis for fewer wind blade orders heading into 2009.

LM Glasfiber had been running two manufacturing sites since October, one at The Port of Little Rock and another on Scott Hamilton Drive.

Fox said the Scott Hamilton site was intended to serve as a training site for workers while the firm built its $150 million plant at the port. The Hamilton site opened in February.

But the company saw "significant" growth in orders in 2008, so LM Glasfiber decided to keep the Hamilton site open even after the port began filling orders. At the same time, the company was hiring as many as 70 workers a month to meet customer demand for its products.

Fox said it was shortly after the port plant opened that the company's sales team began getting hints that orders might not be as strong heading into the new year.

"And at that time, we tried to react as quickly as we could. We stopped the hiring. Anybody that wasn't in the pipeline -- you know, we went from [hiring] 60 to 70 a month and we stopped," Fox said.

Fox said the company also squelched plans to take the port to a seven-day-a-week operation before the end of 2008.

"And we were extremely hopeful that things would pick back up," he said. "But unfortunately, the picture has become a little more clear and our sales guys said, 'Hey, you know that volume we expected and we were looking at in 2009 just isn't going to be there.'"

Still, Fox said LM Glasfiber's employment levels going into 2009 -- more than 350 people -- is better than its initial plan from a year and a half ago. He said the fundamentals of the industry and the company remain expect strong. One in three fiberglass windmill blades in the world is an LM Glasfiber product, he said.

"It's just, how long will it take to get through the credit crisis and get things moving again so we can get back on a path of growth," he said.

Heading into 2009, Fox said it's possible the port plant could make as many or more blades as both plants produced in 2008. The company will keep its lease on the Hamilton plant, using it as a raw materials warehouse and as offices for Fox and LM Glasfiber's North American headquarters.

And as of now, Fox said, the company has no intention of moving its manufacturing equipment out of the Hamilton plant right now. He said blade manufacturing could begin there again if necessary.

Asked about the LM Glasfiber layoffs at a forum for journalists on Tuesday, Gov. Mike Beebe the United States needs to "stabilize" its message on alternative energy in order to encourage continued job creation.

Three other wind energy companies have already opened or announced plants in Arkansas, and Beebe said state economic development officials are still working to bring yet another to the state.

Jay Chesshir, president and CEO of the Little Rock Regional Chamber of Commerce, said that's the silver lining to LM Glasfiber's Tuesday announcement. The recent concentration of wind energy firms in Arkansas has presented opportunities for out-of-work employees, he said.

"Because of other successes and because of the advanced training that these people have received, these workers are uniquely qualified to work in another" wind energy job, he said.

(Gwen Moritz and Mark Hengel contributed to this story.)