Customer growth driving Fuyao toward break-even year

THOMAS GNAU/STAFF
Caption
THOMAS GNAU/STAFF

Company executives say plant is addressing safety concerns

Fuyao Glass America, the world’s largest auto glass plant, is poised to break even this year, ending two years of financial losses, while addressing employee communication and safety concerns, company leaders said Wednesday.

Launching a sprawling auto safety glass manufacturing complex from scratch has been challenging, leaders acknowledged. But the barely three-year-old Moraine company is meeting customers’ standards and seeing growing customer orders, Jeff Daochuan Liu, president of Fuyao Glass America, told Dayton Daily News editors in a meeting at the plant.

“I don’t think any other company can do the same things that we’re doing,” Liu said.

Fuyao Global Chairman Cho Tak Wong, a Chinese billionaire industrialist, bought the former General Motors assembly plant in the spring of 2014 in an investment observers hailed as historic. The company has said it has invested more than $600 million in the plant and a raw glass supply operation in Mount Zion, Ill.

But there have been growing pains. A pair of top American Moraine managers were let go last November, and Liu said shortly after his appointment that the company had lost about $90 million in two years.

Earlier this year, in its annual report, Fuyao Global said the parent company was profitable even as Fuyao’s Moraine operation lost $41 million in 2016.

That is being turned around, leaders said. Orders for windshields in the first quarter increased and management expects that to continue in the second quarter.

“I have a great chance to break even this year,” Liu said, before adding minutes later: “I have no choice. I have to do it.”

The Moraine operation has more than 2,000 employees, serving Fuyao’s North American automaker customers like Toyota, General Motors, Honda and others as well as the domestic replacement car glass market.

Though the U.S. Occupational Safety and Health Administration has cited the plant for alleged safety violations, plant leaders say they are making progress on that front. Fuyao announced last month that the company has resolved $227,000 in penalties OSHA proposed in November.

For an operation on a floor that covers more than 40 football fields, some safety issues are inevitable, said John Crane, Fuyao Glass America environmental health and safety manager.

Dan Curran — the former University of Dayton president who has a seat on the five-member Fuyao Glass America board — said no injuries at the plant have been severe enough to force any employee to spend a night in a hospital.

“If someone walks out of here with a band-aid, I’ve lost,” said Crane, a former OSHA employee. “There is no business of this size in this country that won’t get a visit from OSHA.”

Employees on all three shifts are invited to quarterly informational briefings where financial information is shared with them, Liu and others said. The meetings are held from morning to midnight to allow all workers to attend, they said.

“It’s a long day,” said Curran, who said he is a presenter at the meetings.

“But it’s worth it,” Liu said.

Further, the executives said they have instituted bonuses and a competitive health care packages that they maintain are fair. The average wage at the plant approaches $17, and they said the health insurance package is better than GM’s.

“All the associates on the floor have the same (health care) package that I have. There’s no difference,” Liu said.

Fuyao is quietly making charitable inroads into the Dayton area that in time will become more prominent, Curran said.

Cho started his charitable foundation, the Heren Foundation, in 2011 with a donation of 300 million Fuyao shares, Forbes magazine reported in 2015. That year, his stake in the foundation was worth $625 million, Forbes said.

“The more I donate, the more I realize how little use I have for money,” Cho told the Financial Times in 2014.

The company last month had a local United Way support event on a Saturday with 1,300 workers participating.

“We do whatever we can to support the local community,” Liu said.


By the Numbers

2,000+: Employees at Fuyao plant

$90 million: Amount company lost in first two years of operation.

$17: Average hourly wage of Fuyao after incentives.

$600 million: Initial investment in Fuyao plant.