Ice Boxes to Boxed Out—Picking up the Pieces

Not many of you probably remember “ice boxes”, where you put a block of ice into an insulated box to keep food chilled. Gibson Ice Boxes started in Greenville, MI because of the great oak lumber found in the area. It evolved into refrigerators and continued growing, but was sold several times: to White, then to Frigidaire and eventually to Electrolux, a Swedish conglomerate. The 1.5 million square foot plant located in Greenville is the largest single refrigerator plant in the world, turning out 1.6 million refrigerators/year. At one time 6,000 people were employed in the plant, but thru productivity enhancements today 2,700 are employed there. At least they will be until November, 2005.

On October 21, 2003 Electrolux informed the city of Greenville that they could build a new plant in Mexico and save $80 million per year. They gave the city until January 1st to see if they could match the savings to keep the plant in the town of 7,800.

The city went to work. They met with the local union, governor, federal contacts and even the CEO of Electrolux. George Bosanic, city manager of Greenville said, “We refused to give up. We put this together over this 70 day period which involved four holidays.” George pointed out to me that “deer season” is considered an unpublished holiday here, as it is in many rural areas.

They got $36 million/year in concessions from the UAW; $8 million in state and city incentives; 200 acres of land for a new plant; and a new efficient 800,000 sf plant that would be leased to the company. The new plant would allow Electrolux to reduce their workforce by 650, while keeping production at 1.6 million units/year. In all the incentives and cost savings amounted to $76 million/year.

But to Electrolux it wasn’t enough and they announced on January 10, 2004 that the plant would close in November, 2005. It was a blow to the town and national and international media picked up the story of how a small town tried to save their plant to no avail.

And, are they now giving up? Nope! The publicity has generated a lot of interest in the town. Bosanic told me, “I’m now working with 24 companies that are looking at us. My goal is to replace ALL of those 2,700 jobs by the time that they close down. We should be making an announcement in the next two months on two new companies that will hire a total of 800 jobs. More announcements will follow.”

With what I saw in Greenville last week, I’m convinced that the closing of Electrolux will be a rough patch in the road, but that they will look back on it as a turning point in the town. And a turning point for the better.