Dive Brief:
- Mack Trucks is investing $70 million in its Lehigh Valley, PA plant, adding on 75,000-square-feet, manufacturing information technology systems, equipment and tooling, and a building to do vehicle quality audits.
- Along with these enhancements that will take place over the next three years, the chassis assembly work done in Breinigsville, PA will be relocated to the plant, while the downsized Breinigsville operation will continue to provide support operations. Mack spokesman Chris Heffner could not confirm whether more workers will be hired in Lehigh Valley, according to Forester Daily News.
- One day after the announced enhancements, Mack released news that Wade Watson, who was vice president and general manager of Mack Trucks Lehigh Valley Operations, is no longer employed by the company. Heffner would not reveal the reason Watson left, according to Forester Daily News.
Dive Insight:
Truck manufacturing revenues rise and fall with economic conditions, just as is the case in most industries. Following a slow spell in 2015, Mack is preparing for better times, encouraged by an upturn so far in 2016. "We are looking at 2017 being a comeback year," said Ed Balukas, president of Local 677 of the United Auto Workers, according to Forester Daily News.
The increased pace is largely attributable to a surge in demand for heavy-duty trucks in North America; fleet renewal and fleet expansion; and profit resulting from freight activity, low fuel prices, and low interest rates.
The union has pushed to have the chassis assembly brought in-house for some time, and in Balukas’ words, this move will "position us for the next upturn in the trucking industry," according to Forester.
Heffner also touted this strategic decision. "Insourcing the chassis assembly process gives Mack greater control over more of the manufacturing process, enabling us to deliver even higher-quality trucks to our customers," he said, as reported in Forester.
