Tuesday, October 12, 2010

California Companies Moving Away or
Shifting Work Out Reaches New Record: 158
(for 2010 alone)

NOTE: While everything below is accurate, it should be considered a companion to updated information appearing in a Dec. 6, 2010, posting entitled:

Part I: New Record for Calif. Companies
Departing or Shifting Work Out: 193 -
Nearly Four Times Last Year's Level


Now here's the entry about the 158 companies . . .

In the three weeks since my last tally, I've learned about another 14 companies that have left California completely or re-directed capital to build facilities out of state. The names of the 14 and justifications for listing them appear below. Today's entry builds upon the Sept. 21 entry 144 Companies Shrink from Calif. This Year – Three Times the Total for All of 2009.

In short:
Total for 9-1/2 months of 2010: 158
Total for all of 2009: 51

Five enterprises represent the type of operations coveted by many California politicians -- "green" companies -- namely DayStar Technologies, Vetrazzo, SMA America LLC, Enfinity Corp., and Power-One. Those companies have opted for Georgia, Arizona, Colorado and an apparently as-yet-undetermined "overseas location."

I've updated Part III: County-by-County Losses For California Disinvestment Events to reflect these 14 additional entries. In this round, Orange County experienced three disinvestment events; Los Angeles and Sacramento, two; and Alameda, Contra Costa, Fresno, Placer, Santa Barbara, Santa Clara and Ventura counties each suffered one case of "corporate shrinkage." I've also updated Part IV: States, Countries That Gain From California Disinvestment Events.

Nine companies carry the code RELO-OS, which represents an out-of-state or out-of country relocation, while another five are CD-OSG, which means the company directed capital out-of-state for a facility that in the past would have been built in California. I've updated Part V: California Disinvestment Events By Category or Type. (I exclude companies building elsewhere to meet growth -- see Part II: Examples of Companies Excluded From California Disinvestment Event Listings.)  Also relevant is Part VI: Why California Disinvestment Events Are Greatly Understated.

Add to the list of 144 companies these additional 14:

ALAMEDA COUNTY
2010 Events Reported for 1st Time Here Today: 1


DayStar Technologies, Inc., A "green" company that develops solar photovoltaic products, is planning to set up manufacturing overseas (country unknown). DayStar CEO, Magnus Ryde, said, “While DayStar has accomplished significant innovations with our CIGS process and technology, we have encountered challenges in obtaining affordable capital for the build-out and operation of our facility in Newark, California. At this time, we are pursuing opportunities to manufacture our CIGS modules offshore . . . potential partnerships . . . include joint ventures, licensing agreements, contract manufacturing agreements, a reverse merger with or an acquisition of DayStar. [We believe that] manufacturing our CIGS modules offshore would provide the best opportunity to bring our product to market and to manufacture the product in the most cost effective manner.” See the company's July 22, 2010, news release "DayStar to Pursue CIGS Production Offshore; DayStar is pursuing offshore manufacturing of its CIGS solar modules." (RELO-OS)

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CONTRA COSTA COUNTY
2010 Events Reported for 1st Time Here Today: 1


Vetrazzo, a "green" company that turns recycled glass into countertops, has been sold to Polycor, which moved the operation from Richmond, Calif., to Georgia. Polycor said it runs a marble quarry there where it can manufacture the countertops more efficiently. California Political News reported that "Vetrazzo came to Richmond around 2006, a tenant of the newly-refurbished historic Ford Assembly Plant . . . . It became a poster child of the city's growing green sector, touting its triple mantra of people, planet and profit." James Sheppard, CEO & Co-Founder of Vetrazzo said a contributing factor was that the Schwarzenegger administration put a state grant on hold for nine months "causing us tremendous capital planning challenges . . . . One may argue that the State should not have been in the business of providing grants to growing companies. However, right or wrong, when a contract is signed, the commitment should be kept. Businesses need to be able to plan." It isn't known how much Polycor paid to buy the company. See the June 6, 2010 story: "Even "Green" Businesses Leaving California." The San Francisco Business Times said the company was sold on June 11, 2010, its equipment moved, and its 22 employees laid off. Vetrazzo had employed about 40 people at its peak in 2008. “I’m sensitive to the fact that the state of California is in a messy situation,” Sheppard said. “But you don’t sign a contract and then rescind it.” Polycor is a Canadian granite and marble company whose U.S. headquarters are in Tate, Georgia. See the June 18, 2010 story "Under the counter: Vetrazzo says state did it in." (RELO-OS)
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FRESNO COUNTY
2010 Events Reported for 1st Time Here Today: 1


Di-Pro Inc., a Fresno brake-manufacturing plant will close by the end of 2010 with jobs being relocated to a new facility in Acuña, Mexico.  (I learned about this only on Oct. 8 when I saw a WARN notice that 114 employees will be furloughed on Nov. 30, 2010.) The move is part of the company’s plan “to optimize our North American manufacturing locations by leveraging corporate shared services, alongside our goal of maintaining lean and cost-effective manufacturing processes and practices to remain competitive in the markets we serve,” says the owner, Bendix Spicer Foundation Brake LLC of Elyria, Ohio, in the Central Valley Business Times March 25, 2010 story "Bendix closing Central Valley plant." The Fresno Bee said the plant is near Del Rio, Texas, and quoted the company as saying "without question, labor costs are lower in Mexico," adding that Bendix must contain costs because of "growing globalization" in the brake business. See the March 23, 2010 story: "Di-Pro move to Mexico hits 120 jobs - Fresno plant that makes brake parts for trucks is relocating." (Find through NewsBank; subscription required.) (RELO-OS)
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LOS ANGELES COUNTY
2010 Events Reported for 1st Time Here Today: 2

Haynes Corp.
, a precision parts manufacturer, is closing some operations in Norwalk, Calif. and moving jobs to a building near the Naples Municipal Airport in Florida. A story from WBBH TV News quotes Dan Neely, Haynes' Director of Manufacturing: "We're in the process of doubling our business in [Florida] and we're shutting down our California operation and moving it to Collier County," he explained. That expansion means between 30 and 50 new positions." See the Sep 28, 2010, story "Plant expanding Collier operations; bringing new jobs."
"Plant expanding Collier operations; bringing new jobs." The Gulf Coast Business Review said, "Manufacturers are cool again" and pointed out that the family-owned business has as customers "giants of industry, such as General Electric, General Motors and Caterpillar" and that the Haynes plans to spend $4 million to move the California facility to Naples and add a building to house its expansion. See the Sept. 3, 2010 story "Back on Track".  (RELO-OS)

International Rectifier Corp., an El Segundo-based business that has been in California for many years and is based in El Segundo, plans to open a R&D facility in Chandler, Arizona by the end of this year. The Arizona Republic reports that the semiconductor firm will bring 80 high-paying jobs to the Phoenix area, noting that "Many of the white-collar jobs will offer salaries of more than $80,000, CEO Oleg Khaykin said, adding that the company also may expand its Mesa plant, where it now has about 100 workers. . . . Arizona was chosen over an unspecified number of other sites, Khaykin said, because of its 'vibrant semiconductor industry,' renewable-energy companies, pool of highly qualified labor, good quality of life, affordable housing and the state's 'business friendly, no-nonsense, can-do attitude.' Khaykin said employers in the Silicon Valley are learning that while that area continues to attract engineers fresh out of college who love experiencing a California lifestyle, those same engineers later reconsider [living costs] when they're ready to start a family. International Rectifier was founded in 1947 in Los Angeles. [It's] leasing . . . in the Price Corridor light-industrial area of western Chandler that is anchored by several Intel fabrication plants. See the Sept. 30, 2010 story: "Calif. semiconductor firm to bring 80 jobs to Phoenix area." (CD-OSG)
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ORANGE COUNTY
2010 Events Reported for 1st Time Here Today: 3


Awesome Products Inc., based in Buena Park, Calif., plans to spend $40 million to expand operations in Arkansas. According to the Orange County Business Journal, which was referencing the Arkansas Democrat-Gazette, the manufacturer of laundry detergent, fabric softener, bleach and other items plans to add about 240 jobs at an expanded plant as well as a new one across the state line from Memphis, Tenn. The company's discount cleaning products are sold at stores such as Dollar Tree, Family Dollar and Dollar General. See the Oct. 1, 2010 story: "Buena Park Cleaning Products Maker Expanding in Arkansas." Also see the Awesome Company's Press Page and click on the Channel 8 News Report "Awesome buys building." Meanwhile, the Memphis Business Journal reported that "Bill Johnson, mayor of West Memphis, says Awesome Products’ commitment could have a 'domino effect' on companies looking to do business with them. Atlanta-based Consolidated Containers Co., which provides containers for Awesome’s products, is adding another shift to accommodate the expansion." See the April 23, 2010 story: "Awesome expands in West Memphis." (CD-OSG)

Beckman Coulter, HQ'd in Brea, Calif,  is investing $18.2 million and will create up to 95 jobs in a new facility in Indianapolis. Area Development Online reported that "The expansion is the third for the company in this Indiana city over the past four years. The biomedical test instrument maker will use the funds to add new equipment to its facility there. 'The state of Indiana's strategic intent to focus on life sciences and advanced manufacturing aligns with our business objectives,' said Lori Gabrek, general manager at Beckman Coulter. 'The area offers a favorable business environment and lower total cost of operations, plus a local work force with strong skills in both engineering and manufacturing. Our operations here have become a Center of Excellence for our discovery products — those developed for life science research and drug discovery.' See the Oct. 8, 2010 story "Beckman Coulter Expanding in Indianapolis with $18.2M Investment." (CD-OSG)

Fasst Company, which makes dirt bike parts, moved from Long Beach to Washington, Utah, in August. The Orange County Register quoted company partner Chris Tidwell as saying that “the reason is to lower our rent, lower taxes, lower utilities that enhance our position in our industry.” He Tidwell estimates the savings will be 25% to 30% of costs in California. See the Sept. 22, 2010 story "Local manufacturer moves to Utah." Also, a company announcement said that moving had been discussed over the last few years and Utah offers a solid base to foster growth and continued development of made-in-America products. The company will retain a Southern California office for marketing and other purposes. See the Sept. 20, 2010, announcement "Fasst Company Moves Headquarters To Utah." (RELO-OS)
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PLACER COUNTY
2010 Events Reported for 1st Time Here Today: 1

SMA America LLC
, a "green" company based in Rocklin, Calif. that makes parts for solar-power systems, has hired nearly 200 people for its new $20 million Denver, Colorado manufacturing plant. It expects to have 700 employees there by the end of 2011. The Denver Business Journal reported: “It’s been a great move,” said Jurgen Krehnke, president and general manager for SMA’s North American division. “It was a strategic decision to [open the plant], and it’s what it needs to be, where it needs to be." It’s SMA’s only factory outside of Germany. See the Oct. 8, 2010 story "German company to hire hundreds more at Denver plant." (CD-OSG)

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SACRAMENTO COUNTY
2010 Events Reported for 1st Time Here Today: 2


Enfinity Corp., a Belgium-based "green" solar development company, relocated its Americas headquarters from Sacramento to Sandy Springs, Georgia, north of Atlanta. According to the Sacramento Business Journal, it will employ at least 30 people initially there, but could expand quickly, adding, "Founded in 2005, Enfinity has grown into one of the 10 largest solar development companies. It has developed four solar farms in Spain, and is helping to develop some of the largest projects in North America, China, India and Europe. . . . In the United States, Enfinity provides solar solutions for commercial, municipal and utility customers. It designs, installs, funds and maintains the solar systems." See the Feb. 26, 2010. story "Solar development company leaves Sacramento for Atlanta." (RELO-OS)

Wells Fargo will relocate 101 student loan jobs from Rancho Cordova to Phoenix, Arizona, and Sioux Falls, South Dakota and will give California employees the option to move to those locations. The Sacramento Bee reported that "Wells Fargo officials in a statement announcing the decision were vague as to additional reasons for the reorganization, saying only that 'in today's ever-changing business environment, we must continuously review our operations and make changes accordingly.'" See the Oct. 6, 2010 story "Wells Fargo relocating student loan jobs from Rancho Cordova." (RELO-OS)
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SANTA BARBARA COUNTY
2010 Events Reported for 1st Time Here Today: 1


CKE Restaurants, HQ'd in Carpinteria, Calif., is moving its technology assistance desk to the Philippines, according to a brief mention in this Los Angeles Times Oct. 6, 2010 story "U.S. jobs continue to flow overseas." No information is available as to the number of jobs involved, when the job shifts will occur, or the capital investment, if any, that will be made in the Philippines. As of this date, Oct. 11, 2010, CKE Restaurants, whose brands include Carl's Jr. and Hardee's, has a total of 45 press releases for 2010 on its website here but not one of them addresses the move of jobs out of high-cost California to low-cost overseas alternatives. This violates Public Relations 101 about being forthcoming about actives. Or, as Henry Kissinger once said, "Anything that will be revealed eventually should be revealed immediately." When a company fails to volunteer its side of the story, people will assume the company is hiding something. (RELO-OS)
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SANTA CLARA COUNTY
2010 Events Reported for 1st Time Here Today: 1


Hewlett-Packard Co., HQ'd in Palo Alto, is laying off an undisclosed number of human resources employees in California (and apparently nine other states, too) and transferring their functions to Panama. This is according to a Los Angeles Times Oct. 6, 2010 story "U.S. jobs continue to flow overseas." No information is available as to the number of jobs involved, when the job shifts will occur, or the capital investment, if any, that will be made in Panama. As of this date, Oct. 11, 2010, HP has posted more than 230 press releases on its website here but not one addresses the move of jobs out of high-cost U.S. locations to low-cost overseas alternatives. This hush-hush attitude violates Public Relations 101 about being forthcoming about activities. As Henry Kissinger once said, "Anything that will be revealed eventually should be revealed immediately." When a company fails to volunteer its side of the story, people will assume the company is hiding something. Where’s the gain in that? I’ve given entire speeches on the subject of fair public disclosure and reputation management, so I’ll spare the reader any more here. (RELO-OS)
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VENTURA COUNTY
2010 Events Reported for 1st Time Here Today: 1

Power-One
, a "green" manufacturer based in Camarillo, Calif., is opening a new plant in Phoenix to manufacture solar power equipment.  According to the Ventura County Star, "'Arizona is where the solar corridor is in this country, and it is really attracting industry,' said Richard Thompson, president and CEO of Power-One. The company will employ more than 350 people in Arizona over the next three years. . . . The 122,000-square-foot Arizona facility is located near Phoenix Sky Harbor Airport. Thompson said the University of Arizona is an important factor as well. 'The university produces more than 80 engineers a year and it has deep ties to the Department of Energy, which is important to us,' he said. Power-One has been based in Camarillo for about 40 years." See the Oct. 5, 2010, story: "Camarillo solar firm plans to expand." Jan. 31, 2010 Update: Today Power-One, Inc.), the world's second-largest manufacturer of power inverters for the renewable energy industry, opened its first North American manufacturing facility in Phoenix. The plant will produce photovoltaic (PV) and wind inverters that convert renewable energy into a usable form of electricity for distribution on the utility grid. The facility will reach a capacity of 1 gigawatt of product by year’s end with site capacity reaching 4 gigawatts, which would generate enough electricity to power up to two million homes. Inverters manufactured here are for residential, commercial and utility settings ... Power-One is already expanding Greater Phoenix's renewable energy supply chain. FAIST, a multinational United Kingdom-based company and a Power-One supplier, announced in December it will establish its first U.S. presence in Phoenix with FAIST GreenTek LLC to manufacture steel and metal structures and employ 100 to 150 people. See the company's announcement Gov. Brewer, Mayor Gordon Celebrate Power-One's Grand Opening. (CD-OSG)

Joseph Vranich is available for public speaking on the subject of business relocation in the U.S. regardless of whether California issues are involved.  

© Copyright by Joseph Vranich, 2010. Use is permitted provided attribution is given to "Joseph Vranich, The Business Relocation Coach located in Irvine, Calif."