SKF Shuttering Glasgow Hub Plant

SKF AB announced it will close its wheel bearing hub assembly manufacturing facility in Glasgow, Kentucky, consolidating it to a sister plant in Puebla, Mexico. SKF said the move was necessary for it to remain competitive in the changing U.S. automotive market. Approximately 110 hourly and 30 salary employees will lose their jobs.

The hub units manufactured in Glasgow, (including its X-Tracker series used on the Dodge Dakota and Durango) are sold to both automotive OEMs and into the aftermarket.

Production will be phased down over the next 18 months as it is transferred to Puebla. Some hub units will not make the transition, and SKF will stop producing them entirely.

With the Glasgow plant closing, SKF will no longer be manufacturing wheel bearing hub assemblies in the United States.

In 2005, SKF surprised the industry by shuttering its eight-year-old hub assembly manufacturing facility in Aiken, South Carolina. With the Glasgow announcement, SKF USA President and CEO George Dettloff said: "The U.S. automotive industry continues to restructure as a result of a weak marketplace, leading to increased pressures for companies supplying this segment to maintain profitability. In an effort to remain competitive, SKF has decided to consolidate its North America-based manufacturing operations responsible for supplying the automotive market."

The city of Glasgow has had a run of bad luck with its SKF facilities. At one time, Glasgow was home to large-scale SKF bearing manufacturing operations, and soon there will be none.

Since 1965, Glasgow had been home to SKF's Tyson brand bearing plant; SKF acquired Tyson in 1955. Tyson production was consolidated to Glasgow from Massillon, Ohio in 1981, and the line reoriented toward the by-then more profitable large tapered roller bearings. However, Tyson hit a downtrend and amid mounting losses in the late 1990's, SKF announced it would close or sell the troubled division. Tyson was eventually sold off to RBC Bearings for $10.2 million; RBC left it in Glasgow and leased the floorspace back from SKF.

Tyson never performed well for RBC, either, and the collapse of Class 8 truck sales in 2007 sealed its fate. RBC shuttered Tyson Glasgow in mid-2007. Meanwhile, SKF had invested heavily in its Glasgow Hub Bearing Unit, but cyclical softness in the automotive market hurt sales and capacity utilization. In 2000, laid off workers were denied Trade Adjustment Assistance because the U.S. said the layoffs were not due to increased imports but instead to declining domestic demand: "The investigation revealed that the subject firm sales increased and imports declined during the relevant time period. Layoffs occurred as the inventory levels of product mix changed with demand from subject firm's contract customers."

SKF de Mexico, founded in 1920, started manufacturing bearings under the SKF brand at Puebla in 1988. At over 450,000 square feet, the plant employs approximately 500 workers manufacturing large spherical roller bearings, ball bearings, mounted bearings. In 2005, it added hub assembly production transferred from Aiken; prior to Aiken's closing, Puebla did not have hub unit capacity.

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