Sun Products to close Baltimore manufacturing plant

Nearly 300 workers will lose jobs; company is moving production to Kentucky

February 11, 2014|By Jamie Smith Hopkins and Natalie Sherman, The Baltimore Sun

Household products maker Sun Products Corp. said Tuesday that it will close its nearly 90-year-old Baltimore manufacturing plant in June, laying off almost 300 workers and adding another name to the region's long list of former factories.

Production at the plant, which makes fabric softener and liquid detergents such as All, Wisk and Snuggle, will be moved to the company's facility in Bowling Green, Ky. Sun Products cited location — saying Kentucky is closer to its customers — and the age of the Baltimore complex as reasons.

The facility, spread over 49 acres beside Interstate 95, lies across Holabird Avenue from the site of the former General Motors van plant where Amazon is erecting a new distribution warehouse that will employ 1,000 people. But in a sign of the shifting economic landscape, those jobs likely will pay about half the average at Sun Products.

Robert Fisher, a maintenance machinist at the Baltimore plant and president of the International Chemical Workers Union Council Local 217c, said workers had feared that the complex might eventually close but had not expected the move to come so soon.

The company had previously moved work from Baltimore to Kentucky. The closure will come about a year after the Baltimore plant shut down three production lines, moved one to Bowling Green and laid off 53 people.

The Baltimore plant, which produced about 32 million cases of liquid products in 2008, made just under 20 million cases last year and was on track this year for 13 million at most as work kept going south, Fisher said.

"There's no reason," he said. "That plant was efficient."

Long owned by Unilever, the plant dates to 1926. It once employed 1,500, the union said. Sun Products, owned by the New York private-equity firm Vestar Capital Partners, bought the plant in 2008.

The closure will have a ripple effect on railroads, restaurants and other businesses that served the plant and its workers — and on the city budget. The company paid about $478,000 in personal and real property taxes for the current tax year.

Baltimore economist Anirban Basu said the continuing loss of manufacturing jobs — even in the face of "the nation's industrial resurgence" — makes it critically important for local and state policymakers to find out what can be done.

"If we do not do that, we are doomed to an ever-shrinking middle class," said Basu, head of Sage Policy Group, an economic and policy consulting firm. "We need to do something to stop the hemorrhaging of industrial jobs in Maryland."

Some business leaders say Maryland's taxes and regulations make the state noncompetitive for companies that do not need to be near Washington. But Kathryn Corbally, a spokeswoman for Sun Products, said neither taxes nor regulations played a role in the closure decision.

"The regional volume requirements do not support the overall costs and we get much more efficiency of scale by consolidating our production," she said in an email. "The economies of scale far outweigh tax and regulation costs."

Fisher, the local union president, said the company had made the plant less economically viable in recent years by reducing production there. He and other workers interviewed Tuesday said they believe the company wanted to shed its only unionized plant to make itself more marketable for sale, even though the Chemical Workers union agreed to contracts in recent years that cashed out the pension, lowered wages for new hires and made other concessions the company sought.

Corbally said the company has good relations with the unions at the plant and that economics, not unionization, drove the shutdown decision.

"The reality is that labor costs make up less than half the total cost of production," she said by email. "We can no longer produce product in Baltimore at a competitive total delivered cost."

Workers said they were notified of the closure at a 10 a.m. meeting Tuesday, shortly after corporate leaders met with local management. The mood in the room was somber and emotional, workers said.

"It was, 'You've lost your job, your livelihood. Good luck,'" said Walt Fales, 48, a Rosedale resident who has worked at the plant in maintenance for 15 years.

Sun Products said laid-off workers will get severance payments and job-search assistance. But manufacturing jobs often pay substantially better than positions in other fields — and manufacturing jobs are harder to come by than they once were.

Baltimore has lost two-thirds of its manufacturing jobs over the past 20 years, according to federal estimates. Statewide cuts also have been deep.

At Sun Products' Baltimore plant, the average wage was about $24 an hour, the union said. Some skilled workers, such as machinists, made $32 an hour. That's not counting plentiful overtime.

Amazon reportedly pays about $12 a hour for distribution jobs such as those it is creating across the street.

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