Tenneco’s operations in Seward and Lincoln could be cut, not closed

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By The Associated Press

Tenneco’s exhaust-systems plant in Seward and its operation at Lincoln Industries are safe for now from the auto parts company’s closing plans, but they still could cut back operations and the Tenneco shock absorber plant in Cozad remains vulnerable, a spokesman said Monday.

As the automotive industry retrenches and asks for help from Washington, parts suppliers all over the nation continue to face difficult times.

On Oct. 29, Tenneco announced that it would close four plants in North America and cut back operations at another.

It has named two, one in Indiana, the other in Ohio.

In Nebraska, Tenneco’s Seward plant makes original equipment emissions parts. It employs more than 500 people, as does the company’s Cozad plant, which makes Monroe shock absorbers.   In Lincoln, Tenneco makes exhaust equipment for Harley-Davidson at Lincoln Industries.

Tenneco spokesman Jim Spangler said Monday the company has not yet publicly announced which two other plants will close. He said there was no timetable for the announcement, but that the company wanted to make a decision quickly so it could ease the worries of workers and communities that won’t be affected.

One of the closings will be among three Tenneco plants that make suspension parts: the Cozad plant and plants in Hartwell, Ga., and Kettering, Ohio.

In Cozad, Tenneco is the largest employer.

Tenneco will also close one of its plants that ship emission parts on a just-in-time basis, but Spangler said that wouldn’t include the Seward plant nor the smaller works in Lincoln, neither of which is a just-in-time operation.

But he said both are among the nine emission-control parts plants that are candidates for production cutbacks that would include consolidation of production lines. That likely would mean local layoffs, but the plant would remain open, Spangler said.

The Big Three automakers of GM, Ford and Chrysler make up about 33 percent of Tenneco’s global revenue, Spangler said, and his company “fully supports efforts in Washington to get legislation passed for a bridge loan.”

More than 4,000 Nebraska workers supply parts for the nation’s automotive manufacturers, U.S. Census data say.

Most of those automotive parts jobs are in a few small cities and towns.

Auto suppliers’ sales have tumbled because of the steep drop in demand for new vehicles.

So, say analysts, suppliers are using up their cash reserves and cutting costs to stay in business.

Craig Fitzgerald, an automotive analyst with Southfield, Mich.-based Plante & Moran PLLP, said that if the parts companies can’t find friendly banks or other sources for operating capital, subsequent bankruptcies and liquidations will disrupt the parts supply lines. And that, he said, would throw big wrenches into any plans Congress or federal bailout officials have to keep the Big Three afloat.

Tenneco’s Spangler said his company wasn’t looking for any federal help “and has ample liquidity.”

“The action on Oct. 29 was to help us preserve cash,” he said.

Senate Democrats were expected to introduce legislation Monday attaching an auto bailout to a House-passed bill extending unemployment benefits.