Granite City foundry springs back to life.
During a 6 1/2-year hiatus, not a single casting was poured at American Steel Foundries' Granite City plant. Today, the furnaces are relit and 250 people are back to work.
"It's music to my ears," says Bill Donovan, referring to the noise coming from American Steel Foundries' Granite City, IL, casting plant.
Donovan, works manager at ASF's Granite City Foundry, calls the din of the molding machines and fired-up furnaces "music" because the foundry was totally silent for more than 6 1/2 years. He must often have wondered during that time if he would ever again hear the sounds of steel castings being made.
The foundry was "temporarily" mothballed in November 1982 due to a severe decline in orders for railroad freight cars. The plant specializes in producing the large cast steel side frames and bolsters that form the undercarriages of freight cars. Donovan, unfortunately, presided over the shutdown and calls it "the worst day of my 23-year career with ASF."
The Rise and Fall
The events that led to the closing of Granite City Foundry in 1982 may have been as dramatic as any segment of the foundry industry has ever experienced. In fewer than four years, Granite City's primary market, the railroad industry, had gone from boom to bust.
"In 1979 the foundry in Granite City produced freight car castings at record levels," said Norman A. Berg, president of ASF, a division of Amsted Industries, Inc. "The record production resulted from increased customer demands for freight car components, which were at the highest level in the history of the freight car building industry."
In 1978, nearly 60,000 freight cars were built in the U.S. During 1979, demand for freight cars had risen to 90,000 cars.
Much of the demand for freight cars in the late 1970s and early 1980s was, in fact, artificial. Many of the freight cars being produced during this period where what the Chicago Tribune in a recent report called, "Wall Street Cars." These were cars built and bought by individuals as investments.
To keep up with the growing demand for the steel castings used to make the freight cars, ASF in 1982 invested $14 million in the Granite City facility, which at the time was considered the largest producer of steel castings for railroad cars. ASF also believed the investment would make the foundry the most advanced of its type anywhere.
By 1983 the bottom fell out of the railroad market. From the record demand of 90,000 cars in 1979, orders for new cars fell to 6000 during 1983. Since rail cars were the single largest market for steel castings produced in the U.S., the devastating effects of the massive slump for railroad castings were felt throughout the industry. In 1979, U.S. steel foundries shipped more than 2 million tons of finished parts. In 1983, fewer than 800,000 tons of castings were shipped for sale.
Amsted Industries and ASF, as the largest producer of steel railroad wheels and side frames and bolsters, had little choice but to close the foundry. But with the recent $14 million investment tied up in the plant, the decision was made to temporarily rather than permanently close the 95-year foundry, with the hope that things would turn around soon. Unfortunately, it took nearly five years for conditions to improve enough to even consider reopening the foundry.
In addition to side frames and bolsters, and end-of-car coupling equipment through its ASF division, Amsted Industries is the world's largest producer of cast steel railroad wheels and composition brakes through its Griffin Wheel division. In all, Amsted has six railroad wheel manufacturing plants--four in the U.S. and two in Canada.
The effects of the steep and prolonged recession in the railroad business were felt by the Griffin Wheel division, as well. Two of the Griffin foundries were temporarily closed in 1986 and 1987. While one remains idle, it was the reopening of the company's wheel plant in Bessemer, AL, in 1988, that signaled a possible turnaround in the railroad supply industry. The Bessemer plant had been closed for only a year.
Back to Life
As it turned out, 1988 was indeed the pivotal period as demand for railroad cars moved up sharply. Orders for cars jumped to nearly 23,000 in 1988, up from fewer than 14,000 in 1987.
Both orders and installations of new freight cars rose sharply during the first quarter of 1989, according to the Association of American Railroads and the American Railway Car Institute. During this period, combined orders for all U.S. manufacturers jumped 50% from the comparable period of 1988, rising to 11,040 new freight cars in 1989 from 7345 in 1988.
The continuing improvement in orders for freight cars through late 1987 and into 1988 prompted Amsted to announce in July 1988 that it would invest more than $1 million to get Granite City Foundry ready for possible future production of cast steel railroad parts.
With the dramatic improvement in early 1989, the decision was made to resume production at the foundry. Berg explained the decision by saying, "We believe the time is right to bring additional manufacturing capacity on line."
With 250 employees recalled, the first castings were poured at Granite City Foundry in June 1989, 6 1/2 years after being temporarily shut down. This in itself may have been quite a feat.
"To the best of our knowledge," Berg said, "this is the only time a U.S. steel foundry has been brought back to life after such a lengthy shutdown."
Works manager Donovan described the restart of the foundry as "like an athlete who's been laid up for awhile. He knows how it's supposed to happen, but it doesn't always work because his body isn't conditioned."
ASF, which will continue to operate a single shift, has no plans for an additional recall of employees or new hires in the foreseeable future. However, those who have been recalled are glad to be back at the Granite City Foundry. Donovan, in particular, is elated that the foundry is back to work.
Before the start of a press conference in February to announce that casting production would resume, Donovan ordered the American flag be raised at Granite City Foundry once again.
"I had the flag taken down when the plant went on temporary shutdown in 1982," he said. "I wanted to be sure it was back up again when we announced the reopening."
His sentiments were echoed by Granite City Mayor Von Dee Cruse: "ASF's return to Granite City has done more than just raise the flag; it has lifted the spirits of this entire community."
PHOTO : Closed in November 1982, the plant's reopening coincided with the sharp increase in orders
PHOTO : orders for railroad castings. Granite City, IL is located near St. Louis, MO.
PHOTO : After a 6 1/2-year hiatus, steel castings are again being produced at American Steel
PHOTO : Foundries' Granite City plant. Here, an employee puts the finishing touches on steel
PHOTO : castings that will be used in the construction of railroad freight cars.
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|Title Annotation:||American Steel Foundries also includes a related article on Amsted Industries Inc.|
|Author:||Kanicki, David P.|
|Article Type:||company profile|
|Date:||Sep 1, 1989|
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