RED OAK, Iowa - The future of Echo Windows’ plant here remained up in the air this afternoon as city officials and business leaders met with the local managers of the plant in a last-ditch effort to find an investor, reopen the factory and save about 100 jobs.
Echo Windows is owned by the same Chicago family that owned Republic Windows and Doors, which gained national media attention in December when the Goose Island plant unexpectedly shut down.
Unionized workers there staged a six-day sit-in to demand severance pay and accrued vacation time. After a week of negotiations, Republic’s owners and Bank of America, under pressure from many Illinois politicians, agreed to spend $1.75 million compensating the laid off workers.
But as the Goose Island plant closed up, owner Richard Gillman was sealing the deal on a smaller window manufacturing factory in Red Oak, about an hour southeast of Omaha, Neb.
Gillman announced on Dec. 2 that Republic’s doors would close. The next day, according to property records here, he bought the plant in Red Oak for $700,000.
“They came to town, they promised to double the workforce, same benefits,” says Dwayne Adams, the manager of the non-union plant. “Rural community, they were real excited.”
However, less than three months after buying the facility from Pennsylvania-based Traco, Gillman returned to Red Oak yesterday to shut it down.
Republic and Echo are legally separate but Gillman is the president of both, according to a news release from Gillman. In the news release Sunday, Gillman blamed the bad economy and negative media coverage of Republic’s shutdown for making it impossible to keep operating Echo.
But that’s not the case, says Mike Vorhies, the engineering manager at the plant.
Prior to the purchase, the Traco plant had been doing about $15 million per year, enough for it to roughly break even. After the purchase, orders continued coming in at the same pace, Vorhies says.
“We still have windows, orders, and we still have business coming in,” he says. “The economy has nothing to do with it. The sales are there.”
Managers at the Echo plant in Red Oak received an e-mail Saturday night telling them the plant would close down, sending them scrambling to find a way to buy up the facility and save its jobs.
“The only problem was it was all in motion and it all was looking good, but it wouldn’t happen quick enough,” Vorhies said this morning.
If the managers can find a way to buy the company, they would also have to come up with $1.1 million to pay Echo’s bills to suppliers they say have never been paid.
Thomas Figel, a Chicago spokesman hired by Gillman, says he had no knowledge of any unpaid bills at the Echo plant.
George Maher, the executive director of the Red Oak Industrial Foundation, is optimistic that a deal to save the plant will come together.
"We don't have that much time, these people need jobs,” Maher said this afternoon. “Today we have done one week's work. We are pushing as hard as we can, we want to get them back to work.”
The prospect of 100 people losing their jobs rippled quickly across this town of 6,000 in an area of southwest Iowa that has seen several other businesses lay off hundreds of workers recently.
“There are a lot of hurt, frustrated, angry, unhappy people in our town,” says Jerry Dietz, who owns KCSI, the local news radio station.
The managers at the Echo plant feel they got the short end of the deal, too.
“He took us for a ride from the get-go,” facilities manager Nate Lunn says of Gillman. “That’s how we perceive it.”
- Chi-Town Daily News reporter Fernando Diaz contributed to this report.
Daily News Staff Writer Peter Sachs can be reached at 773.362.5002, ext. 18