Not Your Dad’s Old Bumper or Paint Job
More sophisticated production challenged REHAU to make Alabama home to its first R&D center outside of Germany. Alabama’s challenge is to provide the workers skilled enough to build the bumpers and do the paint jobs today’s R&D demands.
REHAU’s Albert von Pelser says if Alabama wants to keep growing, “the growth has to come from workforce development.”
Business has never been better at the REHAU automotive plant in Cullman.
Sales will set a record in 2015, the facility will add at least 120 workers to the 850 it already has, and REHAU will open a $2.5 million technical and research center — the only facility of its kind that REHAU has in North America. And all of this comes on the heels of a $115 million expansion completed early last year.
“This plant will have the best year since production began here in 1996,” says 50-year-old Albert von Pelser, manager of the REHAU (pronounced ray-How) plant. “Our main customers — Mercedes, BMW, all of them — are forecasting record numbers for 2015 that we haven’t seen since we started supplying parts for them. We actually had to give some business away to create capacity for other business that we got because we’re completely maxed out. We’ll probably have 25 percent more business in 2015.”
REHAU’s success and growth has not come without challenges. According to von Pelser, “The biggest challenge in 2015 will be 100-percent worthy personnel. It will be difficult to find 120 or more new employees and train them. With the unemployment rate at 4.7 percent, it’s becoming more difficult to find people who bring the necessary knowledge to our facility.”
Founded in the Bavarian town of Rehau in 1948, the family-owned company employs more than 18,000 worldwide. Among its earliest works was the production of sideboards and arm straps for the Volkswagen Beetle, and it also produced silicone tubes used in Germany’s first heart operation. It is now known for polymer-based solutions for the construction and automotive industries.
The Cullman facility manufactures bumpers, rocker panels and spoilers for Mercedes-Benz U.S. International in Tuscaloosa County; spoilers for BMW, and rocker panels, body side moldings and fender flares for Nissan. The Cullman facility is primarily involved with injection molding, where heated polymers are injected into a mold, and with robotic painting — both of which require intricate machinery that requires a high degree of expertise to operate.
Part of REHAU’s challenge in Alabama is that the products it makes are getting progressively more sophisticated. When the Cullman plant first started manufacturing bumpers for Mercedes-Benz, for example, the bumpers contained no electronic components. But now, REHAU embeds up to several hundred dollars’ worth of electronic components into the bumpers — park distance sensors, blind spot sensors, fog and daytime running lights and others.
“People ask why we need a higher-skilled workforce than we had in 1998, and it’s because the industry has changed that much,” von Pelser says. “The requirements for operating machinery we have now have gone up tremendously over the past 15 years. The expertise, particularly for painting, is rare in the United States but particularly in the Southeast and even worse in Alabama. It’s almost impossible to find paint experts here.”
Von Pelser says that Alabama’s hourly workers are motivated and dedicated. But they simply don’t have the necessary skills and preparation needed at the entry level in today’s world of manufacturing. As he did in a recent speech to the Rotary Club of Birmingham, von Pelser is actively pushing for solutions to the preparation quality of Alabama’s workforce. That, he believes, could lead to a major win-win for the State of Alabama and its manufacturers.
“I’ve talked with a lot of people over the past 12 months, and I think that if Alabama is going to continue to grow, the growth has to come from workforce development,” von Pelser says. “I see many communities, Cullman included, that have their own initiatives. Tuscaloosa is doing a great job. In Birmingham and other places, there are so many people trying to do something with workforce development and better training, but I’m missing the statewide approach — and I know the governor has the initiative going to start a statewide approach.
“Seventy-five percent of the people entering the workforce in Alabama have no college degree, and they get no state-organized training that helps industry grow up with the big businesses,” he says. “In Germany, most workers have done a three-year apprenticeship before they begin their professional careers. We can’t take people (in Alabama) and change them in two weeks.
“In my mind, workforce development is the future,” von Pelser says. “I know the governor has started an initiative, and I know they’re trying with [AIDT], but it has to go much deeper than that. We need a statewide approach where communities can learn from each other. If Alabama is capable of changing the way it does workforce training, if it gets better at it, people from all over the world will fight to have plants in Alabama.”
Attracting talent is one of the reasons that REHAU is building its new technology and research center — which REHAU will call the Alabama Technical Center. The center, the third that REHAU has built and the first outside of Germany, will develop and refine production processes that will be implemented in Cullman and eventually at the company’s plants around the world. Forty-five development engineers will be housed in the research center doing product innovation research that historically has been done at facilities in Germany.
If workforce development is REHAU’s biggest challenge, meeting that challenge is part of its biggest opportunity.
“I know these are cheesy words, but we want to establish ourselves as a world-class automotive supplier,” von Pelser says. “We’ve been doing the industrial recruitment (in Cullman) for 18 years now, and it’s getting to be more of a challenge every year. But it’s an opportunity for us to meet this challenge and prove to our customers that we’re the best choice for them.”
Charlie Ingram and Cary Norton are freelancers for Business Alabama. Both are based in Birmingham.