Anxious times thrust policy moves in center of spotlight

April 5, 2009
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Greg Golembiewski spent Tuesday saying good-bye to nearly 600 employees leaving work for the last time at the General Motors Corp. Stamping Plant outside Grand Rapids.

“It was a very sad day,” Golembiewski, president of UAW Local 730, the last and the largest UAW union in West Michigan representing GM workers.

GM announced last fall that the stamping plant would close this year, and Golembiewski said all production likely would end this summer, though tool and die workers might work on parts for GM’s electric Volt through the fall.

And though President Barack Obama’s demand last week for further restructuring for GM and Chrysler LLC won’t have an effect on his factory, Golembiewski hoped it would have an effect on the auto industry.

“It isn’t going to change what happened here in Grand Rapids — we’re still going to close,” Golembiewski told Marianne Rzepka, reporter for Bridging 96, a joint venture between the Business Journal and Crain’s Detroit Business. “But hopefully, down the road, somebody else might not have to suffer the same fate.”

Obama announced Monday that GM and Chrysler have “a limited amount of time to work with creditors, unions and other stakeholders to fundamentally restructure” before they are considered for more than $20 billion in taxpayer funds in addition to the $13.4 billion received in January.

The car companies still face a government-funded and supervised bankruptcy if they don’t come up with acceptable plans for financial stability, the president said, but he didn’t demand the struggling auto firms repay $13.4 billion in federal loans they’d already received. Obama even gave the industry some words of hope.

“We cannot, we must not, and we will not let our auto industry simply vanish,” Obama said. “This industry is, like no other, an emblem of the American spirit … a once and future symbol of America’s success.”

Golembiewski was happy to hear it. “I am glad we have a president in office who is concerned enough — not just about GM, but the auto industry and suppliers — to take action,” he said. “I’m glad we have a president who is not willing to let us die.”

Tracy Schneiter, senior auto analyst with IRN Inc., a manufacturing consulting firm in Grand Rapids, agreed.

“We’re relieved the administration is standing behind the industry as a whole,” she said. “It’s very integral to the economy; we can’t just walk away from it.”

Schneiter said she appreciated the work of the Automotive Task Force, which advised the president. Its members showed they understood what was going on in the industry, despite their lack of direct experience in the area.

The rocky economy is troublesome for all the car companies, she said, both foreign and domestic. But GM and Chrysler have additional troubles: GM’s large debt and union costs, and Chrysler’s lack of funds and products.

The newest thing Schneiter heard in the president’s talk was the program for incentives for consumers, who will get their GM and Chrysler warranties backed up by the government if the companies fail.

Lt. Gov. John Cherry said in a statement that the final verdict is still out for GM and Chrysler.

“The Automotive Task Force has established some pretty tough preconditions for the automakers to meet before the federal government provides additional assistance to keep GM and Chrysler afloat,” Cherry said. “I understand that it will take tough medicine to undo years of economic neglect of the nation’s industrial base.”

Cherry cautioned that a bankruptcy filing at GM or Chrysler is just short of “putting the nation’s entire industrial base into bankruptcy,” and hoped that the aid conditions were designed to avoid a filing.

Overall, Cherry said his concern is the economic security of the state, and he called on federal officials to work together to help Michigan residents and business make it through this downturn.

High-cost implications

Ron Palmer, president and CEO at Grand Valley Health Plan, ironically was out sick the week the Business Journal called to ask about a $1.9 million loss for 2008 GVHP posted to financial statements filed with the state Office of Financial and Insurance Regulation. Palmer reports that $1.4 million was due to a single case, one of those rare, high-cost situations that prove why cash reserves and re-insurance exist. The frequency of high-costs cases are increasing in general, Palmer says, with the economic downturn. Now, some insurers are seeing cases that top $2 million, he says.

Premature anticipation

Owen-Ames-Kimball was excited last week to tout its involvement in the new Herman Miller National Design Center project in Los Angeles. HMI, however, was not as enthralled with the idea of sharing details amid recent employee curtailment actions. The Zeeland-based manufacturer has design centers throughout the country, including one that is already open in L.A.

While the project is no secret, Herman Miller is not quite ready to talk on the subject just yet — hence the “recall” of the OAK press release. Oops.

Where's Timbuktu? 

It's time to play WorldQuest, an international Trivia game.

Get ready to kick back and put your international knowledge to the test. Game masters Martha Gabrielse and Michael Hampton will keep things fast, fun and furious when the World Affairs Council of Western Michigan hosts the event May 6 at the Wege Center at Aquinas College. Entry fee is $350 for a team of up to eight people, with a $425 buy-in for teams that will gain special recognition and table gifts. Prices include registration, dinner and beverages.

“It's our contribution to the U.S. Commerce Department’s World Trade Week,” said council executive director Dixie Anderson. “This is the only fun thing we do all year. Everything we do is serious — all we do is foreign policy. When’s the last time someone said, ‘Boy, the world’s in great shape?’ This is a great company morale booster.”

For questions or to sign up, call the council office at 776-1721. Individuals can sign up and be put on a team. Council members will be charged $40, nonmembers $45.

Marketing group re-groups

What’s in a name? A lot — especially for a marketing firm.

Grand Rapids-based eMedia Solutions recently changed its name to Bevelwise Media. It was a risky decision, but one spurred by growth, according to Principal Jim Barry.

“As a marketing company, the worst thing you can do is re-brand yourself. We were looking for a new angle on marketing. … ‘Bevel’ is a synonym for slant or angle,” Barry told Business Journal reporter Jake Himmelspach.

 “We have a couple of big things, like we did the Rock and Roll Hall of Fame/Running Subway in New York City and we’re doing Motorguide. We’ve got some things going in Florida — which is another driving factor in our name change, because if we’re doing things on a national basis, you don’t want any confusion out there with who you are.”

Bevelwise maintains 70 percent of its business within Michigan. However, as the company has grown into new markets and as technology has opened up the industry, its former name became common and could be confused with other companies.

“There are lots of ‘eMedia Solutions’ on the Web,” said Barry. “There’s an eMedia Solutions in Chicago with a hundred employees. There’s one in the U.K. There’s confusion on LinkedIn. If you pull up ‘eMedia Solutions,’ you’re going to see two people under that name that aren’t employees of my company.”

Over the last four years, Bevelwise has averaged 60 percent growth. Much of that success, Barry says, is due to two things: “First, surrounding yourself with good people — and we have a great team and great clients. Second, treat clients as ‘customers for life’ — with attitude, approach and importance,” he said. “It’s been an awesome ride.”

Drawing a bead on the MBT

When the Michigan Legislature returns from spring break, Bill Jackson will be there waiting for it to get down to business — and hopefully kill the Michigan Business Tax.

Last week State Rep. Justin Amash, R-Kentwood, introduced House Bill 4728, which bluntly calls for the repeal of the MBT. Twenty-three other House members supported Amash, including West Michigan reps Agema, Bolger, Calley, Genetski, Haveman, Hildenbrand and Meekhof.

Jackson is the new regional policy director at the Grand Rapids Area Chamber of Commerce. Last September, several West Michigan chambers hosted the first Regional Policy Conference, which determined that the first step in improving the business climate in Michigan is repeal of the MBT and cuts in state government spending.

Jackson said that when the MBT was passed in 2007, Gov. Jennifer Granholm pledged it would be "revenue neutral" — but Jackson said the Chamber has been hearing that the MBT may perhaps be "bringing in more revenue than what the SBT did. It's definitely more of a burden on small and medium sized businesses," which is where the new jobs are created.

Jackson said he doesn't have any hard numbers to back up that suspicion about the MBT not being revenue neutral — yet.

"We're hopeful that Speaker (Andy) Dillon will bring up" the MBT, "and we'll have the serious debate that he has been stating he would have on the Michigan Business Tax, when they return from spring break," said Jackson.

Jackson was previously with Adams Outdoor Advertising, where he directed the company's government affairs efforts involving the Michigan Legislature and local units of government. His other prior experience includes private sector management and seven years running his own small business.

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