Charleston’s manufacturing sector thrives despite a struggling economy

Even in a struggling economy, some companies thrive. While the economy faltered in the final quarter of last year, with the gross domestic product rising at an annual rate of just 0.7 percent, exceptions always can be found.

For the moment, Charleston’s manufacturing sector appears to be doing a good job of defying negative trends elsewhere in the state and nation.
According to state figures, the area encompassing Charleston, Berkeley and Dorchester counties gained 700 manufacturing jobs in 2002, while factories shed 16,300 jobs in the rest of the state.

The past few weeks have seen even more good news for the sector, with several announcements by manufacturers planning expansions in the region.

The most recent of these was news from DaimlerChrysler that it will open a third plant in North Charleston this year, employing at least 50 people by 2005 producing steering systems for passenger cars.

“I don’t think there’s going to be any more hemorrhaging,” said Gary Crossley, area director for the S.C. Employment Security Commission.

That may be an overly optimistic prediction, but there’s no doubt the region has received some positive publicity lately.

Economic-development officials were especially happy to see the January edition of Expansion Management magazine rank the Charleston metropolitan area as the 12th hottest city for manufacturing-related expansions and relocations.

With reports of business spending rising, the national Institute of Supply Management said its December index of manufacturing activity rose to 54.7 from 49.2 in November, the largest increase since June 2001 and a larger rise than economists were expecting.

The biggest surprise in the report was the change in new orders reported by manufacturers. New orders are followed closely by economists because they tend to signal future economic activity. When orders increase, manufacturers tend to increase production and the hours worked by employees.

A spot check of several manufacturers in the area revealed that some are showing real sparks of life.

THE BOOM AT BERCHTOLD

The North Charleston manufacturer has become a major player in the surgical-equipment field. It manufactures and markets surgical lights and tables used in operating rooms.

The company also makes ceiling-mounted power booms that can come equipped with monitors, telephones, computers and medical gas. The booms allow doctors and nurses to move around without tripping over cords and tubes.

Company President Joe McDonald said his business is solid. “Our orders are up 39 percent (over last year),” he said. “It’s good news for us.”
The company’s revenues this past year were about $35 million.

He said Berchtold is doing a lot of new business in California because the state is spending money for new construction at state colleges.

Berchtold has contracts with UCLA Medical Center, Stanford University Hospital and the University of Southern California. It also has a contract with the University of Washington Medical Center. The orders were primarily for surgical lights, power booms and operating room design.

“There’s a lot of demand out there,” McDonald said. “It’s more than our business plan called for. Orders that we identify as future were up almost 40 percent.”

He said that Berchtold had one order that was for more than $2 million for surgical lighting systems, ceiling-mounted power booms and surgical tables from UCLA. It is supplying products and designing 22 operating rooms for the next five years.

BOSCH HOLDS STEADY

Robert Bosch Corp. didn’t invent the automobile, but its parts play a major role in keeping it running.

Its local plant, which at 2,200 workers is Dorchester County’s largest employer, manufactures anti-lock brakes and fuel injectors.

The operation off Dorchester Road produces more than 100,000 gasoline fuel injectors a day for major customers such as Ford and General Motors.

The company does not disclose revenues for its individual plants. But the automotive business, which is experiencing banner times because of zero-percent financing, is keeping Bosch busy, company spokesman Eric Kosmeider said.

“We’ve been steady,” Kosmeider said, predicting a 10 percent increase in 2004 for its brake systems.

Kosmeider said Bosch also has seen an increase in orders for its diesel fuel injection system.

The units are installed in the Dodge Ram diesel, Chevrolet Silverado and GMC Sierra trucks.

“Demand for those trucks has been going up significantly,” he said.
He said that business has been flowing for orders for its anti-lock brake system from its “traditional customer base.”

These are domestic automakers and “the new domestic manufacturers” — Japanese firms that manufacture cars and trucks in the United States.

RISING REVENUES AT METAL TRADES

Metal Trades, a heavy steel and sheet manufacturer that occupies almost 500,000 square feet at the former Charleston Naval Shipyard and a ship-repair facility in Hollywood, is thriving.

The company, which has clients all over the world, got into the manufacturing business when the Naval Base and Shipyard were ordered closed in the early 1990s. President Rusty Corbin saw an opportunity for his company to expand its horizons. Now, manufacturing makes up about 90 percent of its work.

Business looks good this year, he said, because of a $7.1 million contract Metal Trades received from the Navy to build 28 nonpowered causeways or floating bridges.

That contract represents almost half of the company’s manufacturing revenues of $15 million this past year. It already has up to $16 million in new orders for this year and projects revenues will rise to $19 million.

“We’re in a good position for 2003,” said Melissa Barton, director of business development.

In the past few years, Metal Trades has built portal or movable cranes for the State Ports Authority, a 450-ton anchor deployment winch for Exxon and components such as exhaust stacks, intake systems and housing units for power plants.

“If it’s made of steel and we have a good set of drawings, we can build anything,” Barton said.

AMERICAN LAFRANCE’S HIRING SPREE

When American LaFrance moved its corporate headquarters and manufacturing facility to the former Western Star truck plant in Ladson last year, it hit the ground running.

“We have more trucks on backlog than we can build right now,” said company President Don Stewart.

In order to keep up with the demand, the company is doing a lot of hiring.

“We’re bringing in 10 to 15 people a week,” Stewart said.

The plant, which employs 360 people, is training the new workers to build trucks, he said.

The company, which also builds firetrucks and emergency vehicles, just landed a major contract with the city of Phoenix to build 100 firetrucks. It also has other big contracts in the works and is building trucks and emergency vehicles for Chicago, Los Angeles and Phoenix.

“We’ve got a lot of multiyear deals that we’re chasing. Some are in the pipeline,” Stewart said.

American LaFrance has become the third-largest emergency-vehicle company by market share, thanks partly to its crea-tion of a national dealership network.
“The only way to gain market share is if you take it from someone else,” Stewart said.

BIG EXPECTATIONS AT JACOBS APPLIED

Jacobs Applied Technology, the Bushy Park designer and builder of modular units for industrial facilities around the world, has its hands full with work.
It recently landed two new, multimillion-dollar projects that include building modules for a pharmaceutical company.

While inside sales director Paul Hochi wouldn’t disclose the names of the new customers, past clients are among the world’s largest companies: Dow Chemical, Chevron Chemical, BP, Rhodia and Conoco.

It’s expecting revenues this year to double, although Hochi wouldn’t say what that figure would be.

“Our business plan for this year is twice what it was last year,” Vice President and General Manager Michael Tate said. “Some of our key clients are expanding their facilities, and we participate in those expansions.”

The company designs and builds preassembled units or modules in its massive 94-acre manufacturing complex along the Cooper River industrial corridor. It’s kind of like taking mobile home construction to a much larger industrial scale.

The units can be the size of a desktop to a six-story building.

The company now has 670 employees and is likely to keep growing.