Hershey Highway (NAFTA)

rskarvan

The Outsourcing of America — Hershey’s Chocolate
By Nancy K. Matthis | Monday, October 15th, 2007 at 11:15 am

In 1894 caramel-candy-manufacturer Milton Hershey created a chocolate company to create a sweet chocolate coating for his caramel candies. The ensuing story of Hershey’s Chocolate Company, headquartered in Lancaster, Pennsylvania, epitomizes of the American experience.

Every aspect of Milton Hershey’s business protocol was philanthropic and patriotic. The company’s business model was so sensible that Hershey’s maintained profitability during the Great Depression and did not have to lay off any workers. Hershey’s supplied milk chocolate bars to American doughboys during the First World War. During World War II they made “Ration D” survival bars for the troops. The company was awarded five Army-Navy “E” Production Awards for its exceptional contributions to the war effort. They even offered the Hershey company’s machine shop to make parts for Navy anti-aircraft guns.

In 1903 Milton Hershey began the creation of a recreational park for his employees and the citizens of the town of Hershey, Pennsylvania that grew up around his expanded operations. Initially devoted to the very American baseball game, and with a bandstand and pavillion, it had facilities for picnicing, boating, and canoeing. It has since grown into a world-class amusement park and tourist destination.

For 113 years Hershey’s chocolate has been an American icon. We have all grown up being rewarded by our parents with a Hershey’s kiss, found a Hershey’s chocolate bar in our lunchbox, or poured Hershey’s chocolate syrup over vanilla ice cream for dessert. Now we can say a tearful goodbye. Hershey’s is laying off 1,500 American workers and outsourcing production to Mexico.

….The largest U.S. chocolate maker … said it would outsource production of some products and would build a cost-efficient manufacturing plant in Monterrey, Mexico.

Shares of Hershey, whose products range from Hershey’s Kisses to Mauna Loa macadamia nuts, rose 2.7 percent on the news.

….The overhaul is expected to reduce annual costs by $170 million to $190 million by 2010, it said….

“From the union standpoint, we’ll do whatever we think we can do to keep our union plants,” said Dennis Bomberger, business manager for Chocolate Workers Local 464, which represents about 2,500 Hershey employees. But he said there might be little the union could do to protect the jobs.

“We’re not the first company to move stuff out of the country,” he said. “If there were a way to stop companies from doing it, I guess that would already have happened.”

TroyD

Perhaps if it weren't so expensive to produce products in this country.......

BDT

jdhdiggs

Yet another fine example how union leadership is crushing American companies and forcing them overseas. So sad to see the loss of American jobs because of the greedy union leadership.

BTW: Even though the article is only a month old, that decision was made almost a year ago. Why are you bringing it up now?

PolkThug

rskarvan wrote: »

Hershey’s is laying off 1,500 American workers and outsourcing production to Mexico

That still leaves 11,500 American workers employeed by Hershey.

cfrizz

Unions have very little to do with shipping jobs overseas. There are tons of companies out there who are constantly looking for ways to send jobs to other countries.

My company has been sending jobs to India for at least 10 yrs! & most of the jobs aren't unionized.

jdhdiggs wrote: »

Yet another fine example how union leadership is crushing American companies and forcing them overseas. So sad to see the loss of American jobs because of the greedy union leadership.

BTW: Even though the article is only a month old, that decision was made almost a year ago. Why are you bringing it up now?

bobman1235

Shipping jobs overseas is a salary cost cutting measure. Unions drive up salaries. It's not the only reason, but it doesn't help.

RuSsMaN

jdhdiggs wrote: »

Yet another fine example how union leadership is crushing American companies and forcing them overseas. So sad to see the loss of American jobs because of the greedy union leadership.

Nail, head, that whole thing. Sad indeed.

jdhdiggs

Cathy:

In this case it is 100% the Union's issue. Most of the populace here was on the Union's side until Hershey let it leak how much the union was making and what Hershey was offering to keep ALL the jobs here. Most of the blue collar folks around here were stunned at the greed of the union. Eventually, the union backed down and managed to save about 1,000 jobs. Hershey was willing to keep ALL the jobs here if the average salary demanded by the union was dropped by something like 3% IIRC. Do the math: 1,500 jobs at $170,000,000 and remember they are factory workers ($113,333/worker). You tell me this wasn't union greed causing the job loss.

cfrizz

:eek::eek::eek: In that case, I say send the damn union overseas!:eek:

jdhdiggs wrote: »

Cathy:

In this case it is 100% the Union's issue. Most of the populace here was on the Union's side until Hershey let it leak how much the union was making and what Hershey was offering to keep ALL the jobs here. Most of the blue collar folks around here were stunned at the greed of the union. Eventually, the union backed down and managed to save about 1,000 jobs. Hershey was willing to keep ALL the jobs here if the average salary demanded by the union was dropped by something like 3% IIRC. Do the math: 1,500 jobs at $170,000,000 and remember they are factory workers ($113,333/worker). You tell me this wasn't union greed causing the job loss.

WilliamM2

It's corporate greed. Hershey's 3rd quarter profits were 62.8 million, it's not like they are going bankrupt. They are losing market share to Nestle and others, and candy sales have been falling for years for all manufacturers. Moving jobs to Mexico will not fix that.

It will insure that I no longer buy Hershey products. Anything I eat comes from the USA.

Ricardo

Survival. Pure and simple.

Sad indeed.

RuSsMaN

WilliamM2 wrote: »

It's corporate greed.

Right, because we all know companies aren't supposed to be successful, and if they are, we should limit it.

jdhdiggs

WilliamM2 wrote: »

It's corporate greed. Hershey's 3rd quarter profits were 62.8 million, it's not like they are going bankrupt. They are losing market share to Nestle and others, and candy sales have been falling for years for all manufacturers. Moving jobs to Mexico will not fix that.

It will insure that I no longer buy Hershey products. Anything I eat comes from the USA.

Did you read the entire PNL? How about the forecasts? I hope you're not planning on eating any candies then because Hershey is still the most "American" of the major candy companies.

BTW: Do you know who get's that 62.8 Million? About 60,000,000 investors, that's who. Just thought you might want to know.

Again, who should get the profit: The investor who floated their own money and exposed themselved to financial risk to fund the endeavor and paid the employees or the guy who just showed up to work, did the job, punched the time card and went home knowing exactly how much he was making. Remember, the employee is giving up return for a decrease in risk while the investor is doing the opposite.

shadowofnight

cfrizz wrote: »

:eek::eek::eek: In that case, I say send the damn union overseas!:eek:

Yup...sounds like its a greedy union issue ....now the warning label on the chocolate is going to have to get larger as well...the one warning that this product has been made on machinery that has processed nuts...gotta add beans...tortillas.... :rolleyes:

disneyjoe7

I'm sure we all could cut our pay by 1/2 so the companies we work for don't feel they need to outsource labor elsewhere.

BaggedLancer

Saw the title of this thread and I thought it was going to be talking about a bad poo

I don't like Hershey chocolate but it is not suprising to see even the most solid "american icon" companies moving out of country.

jdhdiggs

disneyjoe7 wrote: »

I'm sure we all could cut our pay by 1/2 so the companies we work for don't feel they need to outsource labor elsewhere.

Or you could just prove that you are worth the additional investement by your talents and work ethic.

TroyD

jdhdiggs wrote: »

Did you read the entire PNL? How about the forecasts? I hope you're not planning on eating any candies then because Hershey is still the most "American" of the major candy companies.

BTW: Do you know who get's that 62.8 Million? About 60,000,000 investors, that's who. Just thought you might want to know.

Again, who should get the profit: The investor who floated their own money and exposed themselved to financial risk to fund the endeavor and paid the employees or the guy who just showed up to work, did the job, punched the time card and went home knowing exactly how much he was making. Remember, the employee is giving up return for a decrease in risk while the investor is doing the opposite.

B-I-N-G-O

BDT

shack

WilliamM2 wrote: »

It's corporate greed. Hershey's 3rd quarter profits were 62.8 million, it's not like they are going bankrupt. They are losing market share to Nestle and others, and candy sales have been falling for years for all manufacturers. Moving jobs to Mexico will not fix that.

It will insure that I no longer buy Hershey products. Anything I eat comes from the USA.

Compared to $185 million in profit for the 3rd qtr. of 2006. Hersheys earnings are $1.35 per share (annualized) and their dividend yield is 2.9%. Hardly making the shareholders rich. This isn't just the workers either. The CEO and 8 members of the Board of Directors have been fired or resigned. Main cuprit is the cost of materials and energy costs (milk and oil). Declining sales for candy in general are down overall. Cadbury and Nestle are not faring much better.

jdhdiggs

Shack:

Loving it! The brute force of logic and facts....

Thankfully someone adds that, I'd hate to violate the NDA's.

shack

BTW...the Almond Joy I just ate with my cup of coffee was great. I'll continue to eat them even when the guy pushing the button speaks spanish. Of course it didn't have to be this way. Hershey has a long track record of hiring American and would have continued to do so had it not been for the union.

GOOD JOB UNION GUYS.:rolleyes:

disneyjoe7

Ok so they can move 1500 jobs to Mexico, can they also export 15,000 illegal alien's back to Mexico?

rskarvan

shack wrote: »

BTW...the Almond Joy I just ate with my cup of coffee was great. I'll continue to eat them even when the guy pushing the button speaks spanish. Of course it didn't have to be this way. Hershey has a long track record of hiring American and would have continued to do so had it not been for the union.

GOOD JOB UNION GUYS.:rolleyes:

As anyone that has been in the the plant knows... nothing is better than a fresh Almond Joy taken right off the conveyor (while still warm). Of course, now, you'll need a passport to experience that simple joy.

shack

rskarvan wrote: »

As anyone that has been in the the plant knows... nothing is better than a fresh Almond Joy taken right off the conveyor (while still warm). Of course, now, you'll need a passport to experience that simple joy.

Never ate one in the factory for the 50± years I've been eating them. They taste just fine out of the wrapper. If I ever get the urge....my passport it current and I like visiting Mexico.

WilliamM2

I love the anti-American worker sentiment here. You do realize that when no American worker can get a job, all these companies profits will tank? Does anyone look at the long run?

And no, I am not a union worker. But not every American can have a management position, regardless of education and qualifications, there just aren't enough to go around.

shack

Not anti-American. ANTI-UNION. American business would be thriving and there would be plenty of jobs to go around for anyone who wants to work hard for a fair wage if it weren't for the unions. They may have had a place at one time a century ago. They are now a relic...an albatross around the neck of any business they are associated with. IMO

rskarvan

WilliamM2 wrote: »

I love the anti-American worker sentiment here. You do realize that when no American worker can get a job, all these companies profits will tank? Does anyone look at the long run?

And no, I am not a union worker. But not every American can have a management position, regardless of education and qualifications, there just aren't enough to go around.

Not true... profits won't tank. Society will shift towards yet more debt which will finance the greed of the rich. People will stratify based entirely upon debt level with only the upper 1% above the zero mark. America will no longer be the land of the free... but, instead will become the land of the indebted.

Knowing this, those silly bankruptcy laws will be further modified to "sustainable debt" vs. "unsustainable debt". Failure to work for your "sustainable share" of debt will result in mandatory work prisons.

Society will, at all costs, figure a way to protect the stratification of the rich from the poor. The fear of the upper 1% will be income equality.

Its just a matter of time.

shack

Spoken like a true socialist.

rskarvan

On a side note, one of the workers in the plant was being called out for FMLA abuse. This particular UAW fellow called in an FMLA day when he was in jail (130 MPH in a 70)and got caught. Anyway, his response to management was to quote RISKY BUSINESS...."In an oppressed economy, never F#$K with a man's income stream".

jdhdiggs

Here's an idea: "Don't spend money you don't have, work honestly for the money that you do." That would solve all those issues

That's what my Grandfather always said and his wisdom is still relevent today.

Ron: WTF? So you actually support a guy breaking the law, not once, but twice? Or did I read that wrong?

MSALLA

WilliamM2 wrote: »

I love the anti-American worker sentiment here. You do realize that when no American worker can get a job, all these companies profits will tank? Does anyone look at the long run?

And no, I am not a union worker. But not every American can have a management position, regardless of education and qualifications, there just aren't enough to go around.

Your nuts. I was a "worker" for 15 years and still jump in when my company is short handed. But when a guy thinks he should make $30.00 an hour with full paid health bennies for putting in rivits all day something is wrong.

In our area construction companies pay around $800 per day for a general laborer. Not a carpenter or a specialized worker, a laborer. The worker gets around 20 per hour of that in his check then his health bennies, annuity fund, etc,etc. Add on to that if it's night work. auto time & 1/2 for sat. and double for sundays