Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, October 19, 1995 TAG: 9510190026
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: GREG EDWARDS STAFF WRITER
DATELINE: LENGTH: Medium
Virginia Transformer Corp., a home-grown electric products manufacturer that's having a tough time finding enough qualified workers in the Roanoke Valley to handle its growing business, has opened a second plant in Chihuahua, Mexico.
But the expansion into Mexico this summer poses no threat to the 150 jobs at the company's King Street plant near Vinton, company President Prabhat K. Jain said. In fact, he said, the Mexican plant has helped increase business at the Roanoke plant, where the company continues to hire workers.
"We are working full bore here and keeping everybody busy," Jain said. If it weren't for the opening of the Mexican plant, the company would be disappointing some of its customers with delays, he said.
Virginia Transformer started in Roanoke with six employees in 1971 and moved to its present 135,000-square-foot quarters in 1990. Most of the transformers made at Virginia Transformer are used to step down incoming power from utilities to a level where it can be used to run commercial buildings, industrial machinery and subway systems.
The company opened the Mexican plant to provide better service to its customers on the West Coast, avoid some of the transportation costs for its large products, and give the company a greater presence in Latin America, where it has many customers, Jain said. The new plant, which has 30 workers, has equipment that can produce transformers faster than in Roanoke.
Support functions for the Mexican plant, such as sales, engineering and materials purchasing, are being handled at the Roanoke plant, Jain said. For complex and large jobs, units are brought to Roanoke to add switches and other parts specified by customers.
The company has received enough orders to keep both the Roanoke and Mexican plants at full production through the first quarter of 1996, Jain said. Sales for the fiscal year beginning Oct. 1 are expected to be roughly $30 million with the Mexican plant accounting for about $5 million of that total, he said.
Jain joined Virginia Transformer in 1982 after spending five years at the General Electric Co.'s industrial drive systems plant in Salem. In the past five years, the company has grown from 100 to 150 employees, about two-thirds of whom are production workers.
The company has been increasing employment in Roanoke by about two workers a week despite the Mexican plant's additional capacity, Jain said. But, because of the low unemployment rate in the Roanoke Valley, it's been difficult to find employees locally and employee turnover has been high, he said.
"We can put a lot of people to work but we have to find them first," Jain said. He questioned government efforts to attract new industry when that could hurt existing Roanoke companies facing a labor shortage.
Wages at his company range from $7 to $12 an hour, plus benefits that include a 401K retirement savings plan and profit-sharing, Jain said.
The company also is working to train employees so they can take more responsibility for managing their own work. "Our goal is to become the highest productivity company in our industry," Jain said, adding that that would enable the company to pay the highest wages in the industry.
On the company's production floor currently are dozens of transformers under construction - one is about the size of a dump truck, weighs 30 tons and was headed for a steel mill. Also, the company is making all the transformers that will help power a new Las Vegas casino, "New York, New York."
The company custom builds its transformers according to customer specifications. It can take from two to eight weeks to build a single unit. One in the 15,000-kilovolt range can sell for up to $200,000.
The company's major competitors include such giants as ABB ASEA Brown Boveri Ltd. of Switzerland and Westinghouse Electric Corp. as well as manufacturers in Brazil, Mexico, Turkey, India, China, Korea and Taiwan, Jain said.
The company sells its products in the United States - where the market is worth $400 million to $800 million a year - and in 30 foreign countries. The foreign market for the company's products is large because many countries are just now building the infrastructure that demands transformers that was built in the U.S. as much as six decades ago, Jain said.
by CNB