Southpinellas: Canadian company to close plant

Canadian company to close plant

The Pinellas Park operation points to the anemic U.S. economy and less demand for gas turbines.

By ANNE LINDBERG, Times Staff Writer

PINELLAS PARK -- Saying America's weak economy is to blame, a Canadian company has decided to close its Pinellas Park plant, costing 48 employees their jobs.

Although the closure of ABA Industries, 10260 U.S. 19 N, will not be finalized until June 30, the company began laying off workers on Friday. Sixteen of the plant's employees will be offered transfers to another location.

ABA is the gas turbine division of Heroux-Devtek, a manufacturer of aerospace and industrial products. Heroux-Devtek is based in Longueuil, a suburb of Montreal in the province of Quebec.

The company has 10 businesses grouped under four divisions: landing gear, aerostructure, gas turbine components, and logistics and defense. Shares trade on the Toronto Stock Exchange.

"These kinds of decisions are always hard to make but were necessary in the current economic climate," said Gilles Labbe, president and CEO of Heroux-Devtek.

The closing is bad news, Pinellas Park's interim community development director, Tom Shevlin, said.

"From the city's standpoint, it's more the fact we have citizens who are losing their jobs and we're concerned about them," Shevlin said.

But Pinellas Park, he said, has no programs to help the employees find new jobs. Pinellas County's WorkNet program should help them, he said.

Heroux-Devtek decided to close the Pinellas Park plant and consolidate it with the Cincinnati operations after posting a net loss of $6.8-million in its third quarter. That's compared to a net income of $4.6-million during the same period in 2001, the year before.

Sales in the company's gas turbine sector fell by $20.6-million in the first nine months of 2002.

Much of those losses can be blamed on $7.4-million in restructuring costs. But ultimately, the company says the real culprit is the prevailing weak economy in the United States combined with a significant reduction in the demand for industrial gas turbines. "Since the beginning of the year, all of our divisions have suffered from the economic downturn," Labbe said. "We believe that our initiatives to consolidate our operations, to cut fixed costs and to improve our work method will translate into improved performance in the near future."

Heroux-Devtek was founded in 1942. In 1954, the company began specializing in the aeronautical industry, and by the 1960s, it was awarded the contract to build the landing gear for the Apollo lunar landing module designed by NASA.

Heroux-Devtek acquired a majority interest in ABA, a manufacturer of aircraft engine components, in 1989.

In 1993, ABA agreed to annex into Pinellas Park. That annexation was completed in 1996.