A Springfield manufacturer will add about 15 jobs and spend as much as $13 million to expand and buy new equipment to treat parts for Honda.
The company, which is also investing as much as $3 million at a separate facility in Urbana, has seen steady growth in recent years and most recently expanded previously in 2009, said Joe Gummel, executive vice president of Parker Trutec.
The new expansion will add about 20,000 square feet to the company’s Springfield facility at 47oo Gateway Blvd.
“The new equipment is a significant portion of that,” Gummel said of the investment at the Springfield facility.
Parker Trutec provides heat treating and other services to several industries, but is also a long-time parts supplier for Honda. The expansion is necessary for additional space for the new equipment needed to heat treat parts for Honda’s new Continuously Variable Transmission systems, Gummel said.
The expansion will likely be completed by the end of the year.
The improvements at its Urbana facility at 4795 Upper Valley Pike include adding another production line. That plant provides chemical coatings for metal parts for the auto industry.
The company operates five facilities across the U.S. and Mexico, but the majority of those employees work in the Springfield and Urbana facilities. About 220 employees work in Springfield and about 110 work in Urbana, Gummel said.
The company was previously known as Trutec Industries but changed its name last year to make clear its association with Nihon Parkerizing, a sister company in Japan. Both companies have a long relationship with Honda, which helped lead to the current expansion, said Ryoichi Yamada, vice president and plant manager at the Springfield facility.
Increasingly auto manufacturers want to improve the fuel efficiency of their vehicles to meet both higher federal standards and demand from consumers. The heat-treating process, Gummel said, allows auto manufacturers to use lighter weight steel to reduce the weight of vehicles, increasing fuel efficiency.
Parts that have been treated can endure more wear and tear and last longer as well.
Honda’s CVT transmissions use a pulley system rather than traditional gears and are increasingly used to make vehicles more fuel efficient.
The expansion will use the remainder of the available space Parker Trutec owns at its Springfield site at the Prime Ohio I Corporate Park.
The expansion is good news for the city, said Josh Rauch, deputy economic development administrator for Springfield. The city didn’t provide any incentives as part of the expansion, he said.
“They actually came to us champing at the bit to get going,” Rauch said.
Several manufacturing firms in the city have indicated business is picking up this year, he said, and the expansion is further evidence that manufacturing is recovering locally.
“Any time we see anybody growing that’s certainly a good thing,” Rauch said.
The company has fared well despite the recent recession that cost Ohio’s auto industry thousands of jobs, Gummel said. Parker Trutec has surpassed the production levels it reached at all of its U.S. in 2007, before the recession struck, Gummel said. That includes not only the auto industry, but also other customers in the military, heavy transportation and appliance industries the company also works with.
“We worked to reduce our expenses and we were able to secure some new business which also helped us,” Gummel said.
Large auto manufacturers like Ford, GM and Honda have been ramping up production across the state, and have funneled more than $1.8 billion into upgrades at their Ohio facilities over the last few years. Honda alone has invested more than $1 billion in its Ohio manufacturing facilities over the past few years.
Those investments have also helped other area auto suppliers, like KTH Parts Industries in St. Paris, which is undergoing a $29 million expansion this year. KTH produces auto body frame assemblies for Honda.
Yamada also credited Parker Trutec’s employees for its recent growth.
“You cannot expand without good associates and a good technical base of engineers,” he said.
The Springfield News-Sun provides in-depth coverage of jobs and the economy in Clark and Champaign counties. The paper will continue to provide the best coverage of area businesses and put into context their impact on the region’s economy.
By the numbers:
330 — Approximate number of employees in Springfield and Urbana facilities
$13 million — Estimated cost of expansion in Springfield
15 — Estimated number of new hires as a result of the expansion
5 — Number of Parker Trutec facilities in North America