The Urethane Blog
October 16, 2023
Wixom automotive supplier announces layoffs as UAW strike persists
Detroit Free Press
A Wixom-based automotive supplier announced it may need to lay off a substantial portion of its 171 hourly workers, citing “unforeseen business circumstances” at a time when similar companies are blaming the ongoing UAW strike for financial challenges.
This could become more common, as the strike against Ford Motor Co., General Motors and Stellantis moves through its second week.
In a document filed Thursday with the state, Eagle Industries, Inc. indicated “total laid off” employees as 171. The move affects plant workers, production and administration employees.
“As a result of unforeseen business circumstances, we are providing information in anticipation of a potential layoff at the worksite. The estimated number of workers is subject to change due to evolving business circumstances,” the company said in a statement provided to the state.
But Eagle Industries President John Bull said his company filed the paperwork as a precaution. While they employ approximately 171 hourly workers, he said any possible layoff would likely affect 55 to 60 employees.
“It 100% is related to the strike,” he said, noting that in general his business is actually hiring employees.
The company specializes in foam products for the automotive and other industries, according to its website. That includes a product called “EagleZorb,” used in components for vehicle doors, trim and other areas to help prevent injuries. Although there is no mention of specific clients on its website, an association that recognizes companies in the field noted Eagle components have been used in Ford vehicles.
Entering its 10th day, the UAW’s strike is designed to create sustained pressure on the Detroit Three auto manufacturers. That includes what the union considers targeted strikes at one large factory for each company and parts distribution centers for GM and Stellantis. All of these locations rely on third party suppliers to ensure their ongoing ability to function.
Experts noted the downstream impact of a lengthy strike on the related manufacturing industry. One analysis from the University of Michigan predicted 150,000 people in Michigan could lose their jobs if the strike lasts four weeks.
However, the analysis suggested suppliers might avoid layoffs for the first two weeks of a protracted strike. At that point, companies could be in real trouble.
“These growing spillover effects across the automotive supply chain produce successively larger spillovers to the broader economy, as well, as laid-off workers in the supply chain lose purchasing power and cut back on spending in other parts of the economy,” the analysis states.
A separate expert told the Free Press the current strike strategy may result in higher prices for people looking for cars or parts, something that might swing public opinion away from the UAW.
On Friday, union leaders indicated Ford appeared closer to offering an amenable contract than the other two companies. But there’s no indication any agreement with any of the companies is imminent.
October 12, 2023
Business Court judge approves sale of Klaussner business unit
- Richard Craver
- Oct 9, 2023
An N.C. Business Court judge approved on Oct. 2 a Canadian home furnishings manufacturer’s $7 million offer for the Prestige Fabricators business unit of defunct Klaussner Furniture Industries Inc. of Asheboro.
As part of the transaction, VPC Foam USA Inc. would acquire the leases for the 2206 Dumont St. and 905 N.C. South 49 facilities in Asheboro.
The Business Court has oversight of the Prestige properties via a complaint filed in the court by Bank of America Corp. related to its Klaussner loans.
VPC would enter into new leases for both facilities effective with the closing dale of the overall sale. VPC said in its offer that it “intends to operate the Prestige business and will hire a substantial number of former employees to work in the business.”
Klaussner listed in its WARN notice to the N.C. Commerce Department having 127 at its 905 N.C. 49 South, Asheboro plant and 26 at its 2206 Dumont St. plant.
Klaussner entered into federal bankruptcy protection on Aug. 8, immediately shutting down operations and is letting go of 893 employees following an inability to access additional funding from its lender. Klaussner had been in business since 1963.
Klaussner said the tipping point for the decision was that its lending source “unexpectedly refused to continue to fund the company’s operations. This outcome was not reasonably foreseeable, but due to these unexpected circumstances, Klaussner can no longer sustain its operations.”
October 12, 2023
Shell’s Singapore Petrochemical Unit Puts Out Fire; Styrene Impact Likely — OPIS Update
Provided by Dow Jones
Oct 11, 2023 9:39 AM EDT
Singapore’s Shell Jurong Island (SJI) has extinguished a fire that broke out at one of its petrochemical unit manufacturing site on Jurong Island, according to market sources.
The fire occurred at around 3:00 hours Singapore time on Oct.10 and was extinguished with no reported casualties, according to the source.
Market sources said that the fire would most likely impact Shell’s styrene monomer (SM) production.
“The specific impact of the styrene plant is still being evaluated by Shell. We will have to wait and see how serious the damages are,” said a China-based SM broker.
A Shell spokesperson confirmed the incident and said no injuries were reported.
“Our emergency response team is currently monitoring the situation closely. Safety is a key priority to Shell,” the spokesperson said.
At its site, SJI can produce a total of 1,040 million metric ton (mt) per year of SM and 490,000 mt/year propylene oxide (PO) between its two POSM lines, according to its website.
Operations at Shell’s cracker on the same site do not appear to have been disrupted, sources said.
“Besides PO and SM, there should be no disruption to the other chemical production,” added the SM broker.
This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.
–Reporting by Hazel Kumari, hkumari@opisnet.com; Editing by Hanwei Wu, hwu@opisnet.com
October 11, 2023
Tempur Sealy Announces Refinancing of Credit Facilities
Oct. 11, 2023 6:45 AM ETTempur Sealy International, Inc. (TPX)
LEXINGTON, Ky., Oct. 11, 2023 /PRNewswire/ — Tempur Sealy International (TPX), Inc. announced today that it has successfully completed the closing of its $1.65 billion senior secured credit facilities, which include a $1.15 billion revolving credit facility and a $500 million term loan facility.
The proceeds of the senior secured credit facilities will be used to refinance Tempur Sealy’s existing credit facilities and, in the case of the revolving credit facility, for general corporate purposes. The senior secured credit facilities have an accordion feature that permits incremental borrowings of up to $850 million and potentially substantially more subject to compliance with a specified secured leverage ratio and certain other conditions.
Tempur Sealy Chairman and CEO Scott Thompson said, “We are very pleased with the refinancing of our credit facilities. With this refinancing, we have meaningfully extended our debt maturities, improved our financial flexibility, and increased our potential total senior credit funding while maintaining our current cost of funds in what is clearly a tight commercial banking market.”
Thompson added, “We appreciate the strong support from the 13 market-leading lenders who participated in the financing of these facilities. The transaction was substantially over-subscribed, evidencing support for our strategic vision.”
Additional details regarding the refinanced credit facilities are available in Tempur Sealy’s Current Report on Form 8-K filed today with the Securities and Exchange Commission.
October 10, 2023
China PMDI Import & Export in August 2023
PUdaily | Updated: October 5, 2023
PMDI Export
According to China customs data, in August 2023, China’s polymeric MDI exports were 96,700 tons, down 12.8% from the previous month and up 24.6% year-on-year. From January to August 2023, China’s polymeric MDI accumulated exports of 781,500 tons, compared with January to August last year, an increase of 12.2%.
Average export price:
The average export price of polymeric MDI in August was US $1,542/ton, down 32.1% year-on-year, the decline widened.
Table: China’s polymeric MDI export volume and average export price from January to August 2023
From January to August, the United States was the largest export destination of China’s polymeric MDI, and the cumulative PMDI export volume from China to the United States was 184 thousand tons, an increase of 8.4%. In August, PMDI export from China to the United States were 22.5 thousand tons, up 77.3% year-on-year and up 22.6% month-on-month. Secondly, the main destinations of China’s polymeric MDI from January to August are Russia, the Netherlands, Belgium and Turkey.
PMDI Import
According to China customs data, in August 2023, China’s polymeric MDI (including crude MDI) imports of 28.2 thousand tons, down 11.5% month-on-month, an increase of 66.8%. From January to August 2023, China’s aggregate MDI cumulative imports of 199 thousand tons, compared with January to August last year, an increase of 10.9%.
In August, China imported 8,238 tons of polymeric MDI from the Netherlands and 7,004 tons of polymeric MDI from Saudi Arabia. The polymeric MDI and crude MDI imported from Japan was 6,885 tons, and the 200 ktpa MDI facility of Tosoh Japan has shut down for maintenance from early September, so their supply to China market was tight again.
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