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Why Central Moloney Needs a New Factory

4 min read

Chris Hart, president and CEO of Central Moloney in Pine Bluff, is looking for more than a few good workers, and he’s definitely not waiting for the phone to ring.

As noted in this week’s Fifth Monday feature, the market has never been hotter for electrical transformers, the devices that step up and step down electric power, acting as an interface between the high-voltage lines and the outlets in your home or business.

That’s why employee-owned Central Moloney is installing a new transformer factory in the Florida Panhandle, and why ERMCO Inc. of Dyersburg, Tennessee, wholly owned by Arkansas Electric Cooperatives Inc., acquired another transformer maker, Spire Power Solutions of Athens, Georgia, in December.

“We looked at some other sites and some other locations, but quite frankly, the opportunities and incentives in northwest Florida made it a can’t-miss,” Hart told Arkansas Business.

“We’re certainly still an Arkansas-based company, but Florida is the future for us.”

The plan calls for moving one product line from production in Pine Bluff to a new leased facility in Panama City Beach, where production is expected to begin before the end of the first quarter, and where up to 250 employees will work.

“We’re going to do single-phase pole-type transformers in Florida,” Hart said, noting that other lines will expand in Pine Bluff, where the workforce of 550 or so is expected to expand, not contract. “We’re looking to grow and extend our offerings and ability to deliver to customers who are in extreme demand right now.”

That demand is so severe now that electric utilities have delayed or canceled some projects, and the industry warned the federal government in a November letter that the ability to quickly recover from outages is at risk without many more transformers.

Members of Congress have urged the federal government to devote $2.1 billion in disaster money to spur domestic production of transformers and grid security equipment. Joy Ditto, president and CEO of the American Public Power Association, has called the scale of the shortage unmatched in recent memory. Prices for distribution transformers in some markets have doubled or tripled. It’s that old dynamic, supply and demand.

And demand for labor plays into the equation, Central Moloney’s Hart said.

“The greatest challenge we’re facing as a company is just finding folks who want to come to work,” Hart said in a telephone interview.

“In all honesty, the backlog of demand right now is so big that we could move one product out of Pine Bluff and use the people that are on staff already to hopefully increase what we can put out [in other product lines],” he said. “We’re not in a position to let anybody go. If people are willing to come to work on time every day, like I said, they can have a job here.”

Hart needs electricians and other skilled people, of course, but Central Moloney is ready to help new employees learn on the job. “We know we’re not going to be able to hire people who can build transformers or components right off the street, and we’ve got a certain burden of training that we’re going to have to do internally. The biggest thing we’re asking for is a willingness to work, to take a little bit of instruction and correction, and, again, to be dependable. That’s the way we view ourselves around here.”

Hart said an “incredibly weak” power grid is driving the surging demand. “Obviously there have been ebbs and flows in our industry and market for years,” he said. “But traditionally it was tied to single-family dwelling housing starts. That’s because a new house is going to get a new meter loop, and that meter loop has got to be tied to a transformer. But that’s not the driver anymore. The electrical grid is in need of repair, and it is ill-prepared for a future moving forward with electric vehicles. That’s the single largest driver going forward, and that’s not going anywhere in the near future.”

So it’s not a bad time to be in the transformer manufacturing business?

“Here’s the reality,” Hart said. “We don’t have to worry about the phones ringing.”

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