Gene Cleveland, administrative manager, KTH, reflected on the company’s 10th Anniversary during the November meeting of the Cherokee County Chapter of the American Association of Retired Persons (AARP) held in the Cherokee Medical Center classroom.
“We are proud to be here,” said Cleveland. “It is hard to believe we have already been here 10 years. We are supported by the community, we’ve got great people that work at the plant and our work, for the most part, has been on an upward trend.”
This latest recession, Cleveland pointed out, had a big impact on the automobile industry, including Honda.
“The number of vehicles being sold in the United States went way down,” said Cleveland. “With some car companies, it went down further than others. Honda, thank goodness, didn’t go down quite as much as some of the others, but nevertheless, it was very significant. It was a very significant drop in business.”
“As you know, that recession lasted for quite some time,” said Cleveland. “As we started coming out of that recession, we were starting to build back up our production. And some of the people that had left, we were able to hire again, and so we started building up our employment numbers.”
“We got through the recession and a lot of people had hours reduced and things of that nature but they stuck with us through thick and thin, almost like a marriage,” said Cleveland.
“You have good times and then there’s other times when things are not so good.”
Cleveland said production started to pick up again when an earthquake struck in late March, causing a tsunami that destroyed much of the northeastern coast of Japan.
“That tsunami flooded parts of Japan and there are several companies in Japan that make automobile parts, not just for Honda but other automobile manufacturers as well,” said Cleveland.
“And because their buildings were flooded and the associates’ and employees’ houses were flooded, all of these companies had to start making other plans on how to get their manufacturing processes up and going again.”
In mid April, Cleveland said, the supply line of parts coming from Japan to Honda went down significantly so KTH and Honda had to drop the number of parts being manufactured.
“Thank goodness we have such good, loyal associates that work at KTH,” said Cleveland. “And again, we had to make changes in production schedules, and we reduced hours, and we got through that.”
“But guess what happened in April?” Cleveland said. “A strong tornado on April 27 devastated a lot of our state and affected untold number of families. Our power went out in Cherokee County didn’t it? Our KTH plant stayed out for about seven or eight days. Not only were we already seeing the impact from the earthquake and tsunami in Japan, but now we had a power outage. So what production schedules we did have we couldn’t even make those.”
“We found a company in Jacksonville, Fla. that could bring us these tractor trailer size generators and you may have even driven by the plant or seen them,” said Cleveland.
“We had three tractor trailer generators in front of our plant producing just enough energy so we could make production. Even though it was a lower amount of production, we still had enough energy from those three generators to make the production requirements and meet Honda’s schedule, so we had quite a challenge and that lasted for about seven or eight days in late April and early May.”
On Aug. 1 of this year, following healing from the three previous disasters, KTH was at full production once again.
“And then last month something else happened,” said Cleveland.
“In Thailand, they started having floods, rains, and storms, the whole southern province was flooded and that water started filling up the banks of the rivers and dams all over. Several businesses in Thailand started to get flooded out including Honda and not just the automobile industry, but other industries as well have been affected by the floods.’
“These were different parts this time,” said Cleveland. “But those supply lines started getting lower and lower coming to the United States. Just yesterday or recently, Honda has said because the supply lines of parts coming from Thailand, there has been a problem right now, we are going to have to lower our production. So we have already had to lower our production again for the next couple of weeks until they can fix those supply lines and parts coming from Thailand.”
“That is not the best way to start out your 10th Anniversary, announcing we are going to have to lower our production some, until they can get those parts supplied to us,” said Cleveland.
“When Honda shuts down or lowers their production, it affects all the suppliers. So if Honda has trouble getting parts or if some other supplier is having trouble getting parts, from some other country, like Japan, it affects a whole lot of people and a whole lot of companies.”
“So that is really what is going on right now,” said Cleveland.
“They are going to give us updates and we don’t know exactly how long this will be. We will just have to see. We’ve got brave associates that are very loyal and dedicated and we will have to adjust our work hours and all like we have done before so it won’t be a surprise to anybody. Nevertheless, they will get those supply line parts taken care of and then Honda will build their production schedules back up and we will be going again.”
“But things look very good for KTH,” said Cleveland. “We are in a good position now. We are working with Honda. Honda is hoping to add a fourth model. They have already announced they are adding a fourth model, another vehicle, to the three they are already making. We hope to maybe even get a little bit more business from that. Maybe we will be making more frames in the near future.”