posted on February 05, 2014
(Evansville, WI) By Gina Duwe, Gazette
Companies must be lean to bounce back from the Great Recession and overcome increasing competition from China, the president of Stoughton Trailers told a group of more than 100 area business men and women Tuesday.
“It's not just China that's beating us. In a lot of cases, we're beating ourselves,” said Robert Wahlin, president of the fifth-largest trailer manufacturer in North America.
The facilities losing to China have mountains of inventory, scrap bins filled with useable parts and underused people, he said.
He referred to Native Americans finding uses for all parts of a buffalo—“that's what we have to be in order to compete with China,” he said.
“There's no big secret other than we have to be good at what we do and not be wasteful, and that's how we feel we have a chance to be able to compete with a much larger, very powerful Chinese competitor,” he said.
Lori Allen of Allen Realty and Roger Berg of Berg Rentals in Evansville, who sponsored the business luncheon at Creekside Place, had hoped for 30 to 40 people attending. More than 110 people showed up to hear Wahlin talk about how his company survived the recession, rebuilt its workforce and faced the challenges of ramping up and spinning down production.
Stoughton Trailers builds dry vans, intermodal containers, container chassis, grain trailers, furniture vans and other specialty trailers at plants in Evansville, Brodhead and Stoughton.
Production at the Evansville plant has been on and off through the years, and only a couple dozen people have been working there lately. Wahlin announced an order secured last week with a railroad will bring another 100 people to the Evansville plant and keep the line running for at least the rest of the year.
Workers from the other plants will be shifted to Evansville, and the company will begin advertising for hiring soon, he said.
The intermodal equipment built in Evansville is 53-foot containers double stacked on rail cars—not the type of containers that come over on ships from China.
In the early 2000s, China entered the U.S. intermodal market, taking 40 percent of the production. Manufacturers in China can deliver products to California for less than Stoughton Trailers can buy the raw materials, Wahlin said.
The company went from making 155,700 dry vans in 2006 to fewer than 30,000 three years later. Staffing went from a high of 1,600 employees in 1999 down to 250 in 2009.
By 2013, the workforce had climbed back to more than 1,000.
The recession brought other challenges, including high fuel costs and an all-time peak in trucking bankruptcies, which resulted in a flood of used equipment. Large fleets resorted to repairing used equipment instead of ordering new.
When orders dried up, Stoughton Trailers focused on training and education for its remaining 250 employees. It created an internal welding training program, teamed with area tech schools, built its sales network and cleaned and organized 50 years of “clutter and junk” in the plants, Wahlin said.
The manufacturer has diversified its product line beyond dry vans and is fighting to bring intermodal container production back to the United States with a redesigned product.
Wahlin said he sees opportunity now because of labor, material, energy and shipping costs rising for China; lower production costs for Stoughton Trailers in material and labor costs after redesigns and automation; and faith that the large trucking fleets that have delayed equipment purchases will have to eventually catch up.
“We're scratching and clawing trying to get our way back in and bring that business back to Evansville from China,” he said. “That's been a very significant mountain to climb, and we're still climbing it.”