Golden Triangle Development LINK responds to Yokohama Report

Statement from the Golden Triangle Development LINK:

“Unfortunately, no one at the LINK was terribly surprised to read the recent article in Tire Business about Yokohama’s revised expectations for it truck tire plant in West Point, Mississippi.  We have been informed on numerous occasions over the past 4 years about personnel issues at the company’s West Point facility.  In the article and in its SEC filings, Yokohama cited various reasons for the problems they are experiencing, including new production machinery issues and delays.  What was most concerning for us were the cited problems arising from their workforce turnover and training issues.

We cannot speak to exactly what has caused Yokohama’s workforce woes over the past few years, but we do know that the company is now on its third Human Resources Director in just 4 years of operations.  We were advised that the first two were terminated by the Company.  So it appears, at least to us, that Yokohama’s revised plant expectations arise from Yokohama internal management and operational issues and not as a result of any regional workforce problem.  Our experience with our other Golden Triangle industries firmly supports this conclusion.

As you probably know, the LINK spends a great deal of its efforts supporting our existing industries and helping them to grow and continue to succeed.  This means that we meet with them regularly to see what we can do to aid in their success, and also to gather and share information on general workforce matters (e.g., turnover rates, training objectives and goals, etc.).  Unfortunately, while Yokohama has been willing to meet with us from time to time, they have been unwilling to share any general workforce related information.

And while Yokohama is revising its plant production estimates downwards, many of our industries in the region (larger and smaller companies) have recently expanded, or are currently expanding, either their production capacity or their physical facilities and equipment (or both in some cases).  As a result, they are all routinely advertising for, and successfully adding and training new employees.  These include Steel Dynamics, PACCAR, Stark Aerospace, Airbus Helicopters, International Paper and others.  More importantly, these industries are retaining their employees after they are hired and trained.  Across those industries that report such data to us each year, we are happy to report that the annual employee turnover rate is less than 2% annually which is a phenomenally low rate.  Consequently, while Yokohama cites employee turnover and lack of training as part of the reason for its production shortfalls, such problems appear uniquely applicable to Yokohama.

With national and regional unemployment rates at historic lows, we agree that workforce development is an issue at the top of mind for every HR director and company executive right now…not just in the Golden Triangle, but nationally.  Nevertheless, our other industries are apparently taking the right approaches at this time to both hire, train and retain their most vital assets – their people.  This makes the announcement from Yokohama all the more concerning.  We are hopeful that Yokohama can determine what internal changes need to be made so that it can also succeed in the Golden Triangle.  The LINK remains ready and willing to offer and coordinate whatever assistance we can bring to bear to make that happen.”