Employees of Rexdale auto parts makers among 2,000 laid off
Progressive announced Thursday it was closing up shop on all 11 of its small Canadian plants - located in Rexdale and Concord - plus an additional three plants in Michigan, Missouri and Texas, due to an accumulated debt estimated at $540 million, said company spokesman Michael Daniher.
The move came just two weeks after the company gained court protection from creditors on June 20 in order to buy time in negotiations with "key lenders and customers," Daniher said, but they could not reach a deal in restructuring their debt.
"Discussions took place, but those solutions were not secured," he said of the company's attempts to negotiate with the Detroit Three - General Motors, Ford and Chrysler - their main customers. "They elected to take their business elsewhere, forcing the company to take immediate and drastic measures in terms of its employees."
The process of laying off staff, Daniher said, began two days ago with more than 2,000 staff let go at the firm's various locations, but 300 to 500 staff will remain on the job indefinitely while they finish off assignments already underway, help deal with the transition and assist customers in retrieving their tools. Their future is still up in the air, he added, noting that it's too early to speculate whether or not further layoffs will ensue.
"The message of the company to its employees and their families in Rexdale is that Progressive appreciates and recognizes the impact the news had and the speed at which this has all come about," Daniher said. "The company believes things didn't have to turn out this way, but that decision was out of their hands."
Progressive was established in 1967 as a local tool shop and moved into the automotive parts marketplace in the 1990s, designing and manufacturing plastic automotive parts for car and truck interiors.
