3 Rantoul plants set to close - Collins unable to sell; 535 jobs to be lost

3 Rantoul plants set to close - Collins unable to sell; 535 jobs to be lost
By Rick Popely
Copyright © 2007, Chicago Tribune
Published July 6, 2007

Three auto parts plants that employ 535 in the central Illinois town of Rantoul are set to close by July 20 because struggling supplier Collins & Aikman Corp. has been unable to sell the facilities.

Forty-five workers will lose their jobs Friday. A Collins & Aikman spokesman said Thursday that talks to sell the plants continue, but a written notice given Tuesday to workers and the Village of Rantoul said the plants "will ultimately need to cease production" by July 20, idling the remaining 490 employees.

"We're very disappointed," Village Administrator David Johnston said, calling the terse notice a "shock."

"We were all expecting the plants to be purchased," he said. "That's the only communication we've had from Collins & Aikman. They never called us. We'd like to know how something like this could fall apart."

Collins & Aikman, in Chapter 11 bankruptcy protection since June 2005, is being broken up and sold. A year ago, the Southfield, Mich.-based supplier was Rantoul's largest employer, with nearly 950 jobs, but layoffs since have reduced employment to 535.

In April, Collins & Aikman said it had agreed to sell the three Rantoul plants plus six others that make plastic interior parts to privately held Cadence Innovation LLC for $68 million. The sale was to be final by June 30. But negotiations with Cadence have stalled, Collins & Aikman spokesman David Youngman said, and the company had to transfer some of its Rantoul business to other suppliers because its customers, primarily General Motors Corp. and Chrysler Group, needed assurances they would continue to receive parts.

GM and Chrysler last week extended their parts agreements with Collins & Aikman through Aug. 31, but Youngman said they are exercising options to obtain the parts elsewhere.

"Our customers are looking to protect their production," Youngman said. "The negotiations to sell the facilities continue," but they will close if the talks fail.

The written notice to workers said Collins & Aikman doesn't foresee a sale to Cadence "or any other party in the immediate future."

"There are a number of unresolved issues with Cadence before we can move forward," Youngman said without elaborating.

Cadence did not return a call seeking comment.

As Collins & Aikman began removing tooling from the Rantoul facilities Tuesday, workers and village officials recognized that the struggles that have engulfed the supplier industry had reached central Illinois. Several suppliers, including Delphi Corp., formerly the largest; Dana Corp.; and Tower Automotive have entered bankruptcy the last two years.

"The ripples are finally hitting suppliers like Collins & Aikman here," Johnston said. "It's a tough pill to swallow, but we're a can-do community. It's another challenge we have to face."

Rantoul, a town of 13,000 about 20 miles north of Champaign-Urbana, has survived bigger hits to employment. The closing of Chanute Air Force Base in 1993 wiped out 3,500 jobs. Two of the three Collins & Aikman plants are at the former air base, which the village converted to an industrial park.

"This town didn't die then like a lot of people said it would," Johnston said, adding that he expects Rantoul will increase efforts to attract industry. "We'll adjust."

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rpopely@tribune.com