Manufacturers build on success

While most of the U.S. and local economy staggers through the recession of the past couple of years, one sector is doing surprisingly well.

Several manufacturers expect to see record sales in 2010 and are planning to expand to meet the demand for their products. For others, things are not so rosy.

"Times are good for us now," said Ron Nilson, president and chief executive officer of Ground Force Manufacturing in Post Falls.

So good he is having a remodeling done at the company's Seltice Way offices, preparing to welcome 200 customers from around the world for an open house later this summer.

"2010 will be the best year in the history of the company," Nilson said.

Ground Force is not alone.

"We just finished another record year," said Michelle Richter, sales and marketing manager for L A Aluminum Casting Co. in Hayden. A 25 percent increase in sales came largely from production of parts for military applications, and she expects that to continue.

"The next big thing is Oshkosh Truck," she said. That company has a $4 billion contract to produce military vehicles, and L A Aluminum is developing an aluminum and metal matrix brake rotor to be used in the manufacturing of Mine Resistant Ambush Protected (MRAP) and other vehicles.

That means the company will add 20,000 square feet of manufacturing to the 27,000 square feet it now has, with another 40,000 possible in the future at their facility in the Warren K Industrial Park in Hayden.

The company is at peak employment with 50 workers, and expects to be at 80 within two years, Richter said. The current level is in addition to a dozen or more temporary employees, and four or five other businesses are also holding steady as L A Aluminum subcontracts powder coating, anodizing and machine work out.

"We have not experienced the recession," Richter said.

Kootenai County has seen a 1.7 percent increase in manufacturing employment from about 4,020 in May to 4,090 in June, said Alivia Body, regional economist at the Idaho Department of Labor. Although this time last year the Coeur d'Alene Metropolitan Statistical Area (Kootenai County) had roughly 160 more jobs, manufacturing employment has increased each month since the beginning of the year - with the exception of the slight decline in February - for an overall growth of 3.4 percent. Many manufacturers backlogs are filling up and are showing signs of stability, Body said.

That's the situation at Bay Shore Systems, a Rathdrum manufacturer of drilling equipment used in bridge and building foundations and similar projects.

"We have a strong backlog," said Jim Tippett, general manager. "It has been a good year so far."

Since the beginning of the year four employees have been hired, taking the staff up to about 30. That is still below the 55 employed during the peak year of 2008, but that is in part because they are being cautious in their hiring.

"For big orders we use other resources," such as subcontractors, to avoid layoffs, Tippett said.

Orders are backlogged to December, and the company's sales team is working on bringing in more orders that can be filled during the winter months.

The company sells its products worldwide, and Canada and Australia are among the best customers now.

The Australian dollar has improved against the U.S. dollar by about 21 percent, making American products more affordable, Tippett said, and the country is spending money on infrastructure.

That trend is also helping at Ground Force, which manufactures equipment for the mining industry.

"Overseas business has taken off," Nilson said. "The domestic market is stable, but not taking off."

After laying off workers in 2009, all 30 have returned and more are being sought. The Ground Force workforce is now at 75, and with half those in the manufacturing field expected to retire in the next five to seven years, there will be ample opportunity.

For that reason, the state is being asked to step in and provide $70,000 to $100,000 for training new workers at L A Aluminum, Richter said.

That will enhance what companies have already learned in recent years - improve productivity. That has allowed wages to increase, she said, while the business remains competitive.

"Improving productivity is the key to profitable numbers," she said.

Upgrading and adding equipment has helped, as L A Aluminum has spent about a quarter million dollars on new equipment in the past couple of years, Richter said.

"We have been doing really well," she said.

Things have been less stable at Titan Spring, also in the Warren K park, said Jim Glenn, president of the company. Orders have been sporadic, and competition for steel from China and other countries have made it difficult to bid on projects.

Government business has helped keep the 350 employees working two shifts at Kimball Office in Post Falls, said Debra Wunderlich, human resources manager.

"We have not had any layoffs in more than a year," she said.