Directors of Mack Trucks Inc. said last week the company will relocate its Allentown, Pa., truck assembly plant out of state unless Mack and the United Auto Workers can agree by Jan. 17 on efforts to reduce costs at the plant.
Mack, contending with low demand for its trucks, had announced in October that it would replace its Allentown plant, and find other vendors to supply the engines, transmissions and rear axles currently produced by its plant in Hagerstown, as measures to reduce the company's losses.
A company spokesman said the last-ditch effort to keep the plant in Allentown also may decide the fate of the company's Hagerstown plant, which would virtually shut-down if Mack proceeds with plans to "out-source" or purchase components from vendors.
According to a story in The (Allentown) Morning Call, a feasibility study by Mack shows that out-sourcing would reduce the ranks of the UAW's Hagerstown Local 171 from 2,700 to 770. Mack, which is Hagerstown's largest employer, already has laid off 500 at its plant there.
UAW Vice President William Casstevens told Mack directors the union is willing to increase productivity among its Hagerstown workers in return for assurances their jobs will be spared. "The UAW is willing to cooperate on cost-cutting at the Hagerstown plant. We have offered to increase productivity drastically and make the process much more efficient," Casstevens told the Morning Call.
He called "impossible" Mack's demand for $65 million in savings at the plant, according to wire service reports. That would chop wages and benefits "at least" in half, Casstevens said. Instead, Casstevens said he offered to save the company more than $20 million by boosting productivity at least 15 percent. Doing that would lessen Mack's cost per truck part, enabling it to lower its prices and increase sales, said John Collins, an aide to Casstevens.
In a statement, Mack said it will close the Allentown plant, where out-sourcing already occurs, if it is unable to reach "a satisfactory labor agreement that achieves cost reductions that are substantially equivalent to those that can be realized at the out-of-state location."
Mack has not disclosed what out of state locations it would consider. But the UAW reported that Mack has options on land in six states including Virginia, North and South Carolina, Georgia and Tennessee.
Continental Federal Savings Bank in Fairfax has purchased Maryland Marine, a marine finance company based in Fort Washington.
Maryland Marine generates loans through yacht dealers and brokers along most of the East coast. Last year the company approved loans totaling more than $15 million.
"It is a well-run company in excellent financial condition, it has an outstanding reputation and it will further enhance the diversification of Continental Federal Savings Bank," said Allan R. Plumley Jr., president and chief executive officer. He said Maryland Marine's president and founder, John P. Schwenk, will remain in charge of operations.
Continental Federal operates 24 banking offices in Northern Virginia, a loan production center and a mortgage banking facility.
Figgie International Holdings Inc. has announced the consolidation of its executive and administrative headquarters in Richmond, Va., completing a move begun in 1982.
Last week's announcement means Figgie no longer has its principal executive offices in Willoughby, Ohio, a Cleveland suburb. Figgie is the parent of Figgie International Inc., a diversified operating company.
The consolidation was not expected to create any new jobs in the Richmond area, where the company has about 270 workers with 12,000 worldwide.
Figgie International Inc., with more than 35 principal divisions and subsidiaries serving consumer, industrial, technical and service markets, The company reported 1984 sales of $720.7 million.