Ray Trevino, president of UAW Local 925, represents the union workers interests at the Federal Mogul plant in St. Johns, but he says the business behind companies interest is simple.
"It's cheaper. It's just plain cheaper."
Federal Mogul is moving equipment and the work associated to their facility in Puebla, Mexico. They make parts for transmissions and motors. They say they can do it far cheaper in the other facility.
In a statement, Southfield-based Federal Mogul says, "It has become apparent that the plant in St. Johns is not meeting targets. Considering difficult market considerations...in order to maintain the long term viability of the plant...we're tranferring negative margin and low volume business to Mexico."
Marie Remboulis, Director of Communications, says there will be layoffs. She would not say how many.
Trevino says its too early to speculate because he believes some of the job loss can be absorbed by attrition and retirement. About 400 hourly workers work in the plant.
The move is particularly painful given the long negotiations UAW and Federal Mogul went through in October. The union eventually approved wage concessions to keep the plant in town.
The state also contribute $65 million in tax-breaks to keep Federal Mogul in Michigan.
This cut is not related to the Lansing Car Assembly shutdown. They make parts for that facility, but they believe they'll recoup that business with other GM plants.