Less than week after the shutdown of NUMMI, the auto factory's former suppliers face a similar fate.
NUMMI's closure is expected to erase at least 1,200 jobs in the East Bay held by people who work for companies that supplied the factory.
An estimated two or three out of 13 suppliers in Alameda County surveyed for a recent study are likely to survive the shutdown of the NUMMI factory, according to a study by Manex, officially known as the Corporation for Manufacturing Excellence.
"Most of these companies don't know what to do next," said Brent Meyers, president of Manex, a consulting firm for manufacturers. "They have fantastic operational skills, they have skilled workers. But they don't know what alternatives are available to them after NUMMI."
The job losses and financial devastation among the 13 manufacturers alone that Manex surveyed are expected to be severe. Some 917 jobs, $160 million in revenue and $64 million in wages would evaporate if 10 or 11 of the 13 suppliers, which are located in Alameda County, are forced to close their doors, the Manex study found.
"We knew it would be challenging for the suppliers," said Bruce Kern, executive director of the Alameda County Workforce Investment Board. "A majority of their business was associated with NUMMI." The workforce board commissioned the Manex survey.
A separate analysis by this newspaper determined that among all types of suppliers, manufacturers and otherwise,
At least eight companies are affected, according to state records. At least two — Johnson Controls in Livermore and TG Automotive Sealing in Hayward — are going out of business.
Alameda County is home to 31 companies that supplied the now-closed New United Motor Manufacturing Inc. plant, which itself employed 4,700 people.
Santa Clara County contains an estimated 35 companies that provided NUMMI with products or services, according to Manex.
San Joaquin County, Stanislaus and Merced counties also have former NUMMI suppliers.
The lost jobs represents about 75 percent of the work force of the 13 suppliers in Alameda County that Manex surveyed.
"The impact in the Central Valley will be much the same," Meyers said. "It may even be worse."
The aftermath of the NUMMI shutdown is especially complicated for suppliers because of the intense demands of providing goods or services to the factory.
"A lot of suppliers just became order takers for NUMMI, because NUMMI gave them so much business," Meyers said. "They just allowed themselves to be caught up by a regular flow of orders and revenue from the plant."
In a number of cases, suppliers became less nimble because their focus was consumed by NUMMI's requirements, Meyers said.
"When they focused so much on NUMMI, they also allowed their strategic, marketing and sales skills to atrophy over time," Meyers said. "They can't rapidly penetrate new markets."
What about the two or three companies that might escape the NUMMI wreckage? Diversification and preparation appear to be key factors.
"Either NUMMI was less than half their business, or they had started planning for alternatives nine months ago when it became apparent that NUMMI might close," Meyers said. "They had the skills, or they were willing to invest in obtaining the skills to identify alternative markets where they could do well."
Still, it appears that some employers in the area could be taking steps to help East Bay NUMMI suppliers that are in distress.
"Safeway has reached out to the suppliers to buy some products or services," We have had some other employers do the same. This could help them replace their NUMMI markets with others."
Contact George Avalos at 925-977-8477.