Nathan Sedam positions a fuel tube as he works with others on a production line at Martinrea Industries in North Vernon.
Bryce Mayer, North Vernon Plain Dealer-Sun
The financial crisis facing America's Big Three automakers is already affecting the Jennings County economy. From local industries to automobile dealers and beyond, business is suffering.
"The economy has gone south," understated North Vernon Mayor Harold "Soup" Campbell. "Times have gotten tough. The city has been planning to upgrade our water system, but how can we further burden our taxpayers?"
Earlier this year, GECOM Corp. ceased operations at its North Vernon plant, which produces automotive latches and other parts, laying off over 100 workers in what the firm called a temporary suspension of production.
At Metaldyne Sintered Components, which produces automotive connecting rods that link crankshafts to pistons in engines, one shift was eliminated recently in a cost-saving measure. The North Vernon plant also went to a four-day week for production workers.
"There has been a noticeable slowdown the last couple of months," said Dave Tempest, plant manager. "That has made it much more difficult on all of us."
Meanwhile, at Martinrea's North Vernon plant, production of fuel tubes for domestic auto manufacturers continues. Other factories in the area have also experienced slowdowns.
According to the Indiana Department of Workforce Development, the unemployment rate in Jennings County was 7.7 percent in October, the most recent period statistics are available.
"The economic conditions have been hard on everyone and people are scared," Tempest said. "But our morale is OK. It helped when we went to the four-day week because many of our employees who live outside of town are saving on gas."
Metaldyne has at least two factors in its favor. The North Vernon plant is not totally reliant on the domestic automakers since it has a contract with Hyundai. And should the domestic market turn to new technology such as flex fuel vehicles, hybrids and hydrogen-powered cars, Metaldyne will still be able to offer parts.
At North Vernon's two new car dealers, Garlitch Ford and Country Chevrolet, the owners are braced for a rocky road ahead but remain upbeat.
"The American auto industry provides a lot of jobs in this country," Mike Garlitch said. "Much of our economy revolves around the auto industry. I think the Big Three needs some kind of bailout. If they go bankrupt, a lot of people, including in Jennings County, will be hurting. We won't be able to give to the community, such as through the fair and by providing big discounts on police cars for the city and county."
Garlitch said that the credit crunch more than any other factor has slowed his business.
"If the banks could free up the credit market, we can sell cars," he said.
Brian Bennett at Country Chevrolet blamed part of the problem on the media for inflating economic fears among the population. The general sense of panic is not warranted, he said.
"Our sales are down a little bit, but not horribly," Bennett said. "We sold 54 cars last month and GM sold 160,000 nationally."
Those figures may be lower, but they are hardy abysmal, he said, agreeing with Garlitch that more vehicles could be sold if the credit market was not so tight.
"We got to do something to help the automakers," Bennett said. "One in 10 jobs depends on the industry. Many people in our area alone would be affected."
Dave Shaw, North Vernon City Council president, opined that if a bailout is approved, it should not be without strings attached.
"The big car makers need a shakeup all the way from the corporate heads down to the unions," he said.
Campbell said the community's industrial base has diversified in recent years so it is not nearly as dependent on the automotive sector as it once was.
"We have a good balance of different industries in North Vernon but we're not bulletproof," he said. "We're on the edge of the Rust Belt, and we're still pretty much at the mercy of gray metal."
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