Uncertain future
Remington’s bankruptcy filing puts more than 700 jobs at risk
More than 700 people could be out of work within a month if a buyer isn’t found for the bankrupt Remington Outdoor gun plant./
Founded in 1816, the Remington plant here is said to be the oldest gun factory in the U.S. and one of the oldest major employers in the Mohawk Valley.
Now, though, people are hoping it isn’t the last.
More than 700 people could be out of work within a month if a buyer isn’t found for the bankrupt Remington Outdoor gun manufacturer, which operates here.
Groaning under years of accumulated buyout debt, facing lawsuits from families of the
2012 Sandy Hook Elementary School massacre and hobbled by parts shortages brought on by the COVID-19 pandemic, the company in July filed for Chapter 11 reorganization bankruptcy.
Remington is seeking a buyer but no one has definitively stepped forward, according to company officials.
So now, people in this historic Mohawk Valley community are watching, waiting, and hoping for the best.
If the plant shuts down, it would be a body blow to the region which over the decades has seen a steady outflow of goodpaying manufacturing jobs such as these, which can pay $50,000 or more with benefits.
“It would be devastating,” said Rod Brown, whose family-run bowling alley sits in the shadow of the massive brick factory.
Anticipating the possible closure, the firm in recent weeks made a Worker Adjustment and Retraining Notification Act filing that 717 of the Ilion factory’s roughly 1,000 employees could be laid off as soon as this month due to the bankruptcy.
Last week, the company gained a short reprieve, with the sale deadline being moved back a week to the end of September.
“They are hoping for more bids,” said Keith Milligan, vice president of the United Mine Workers local that represents employees at the plant.
There are several possible outcomes. The company could find a buyer who decides to keep its main plants operating here and in Huntsville, Alabama.
Or a buyer could opt to close one of the plants in a consolidation move. The fear there is that they might opt to consolidate in Alabama, which unlike the Ilion plan, has a non-union workforce.
Milligan said that could in part turn on whether the bankruptcy judge, based where the case was filed in Alabama, has a favorable view of unions.
Remington also has ammunition plants in Lonoke, Arkansas, and Mona, Utah, although those are close to being sold, according to several news reports.
Court papers indicate that at least one other gun company, Sturm Ruger, has looked at Remington as has Royal Defence, a Thailand-based armament maker.
But that does not mean these companies will purchase Remington.
“I have not heard of anything solid pertaining to the buyer of Remington,” said Remington spokesman Eric Suarez.
Sturm-ruger didn’t return an email and Royal Defence couldn’t be reached for comment.
Ilion residents say they are in the dark as well.
“It’s kind of hush-hush,” said Penny, a receptionist at a health care clinic in the ARC Herkimer Mall, a small shopping mall that was recently purchased by a notfor-profit disability services provider. Like other human service agencies that now occupy part of the mall, she was seated outside their offices as a COVID-19 precaution. “Everybody is pretty scared about it,” Penny, who declined to give her last name, said of the potential closure.
The fear is that the massive factory ends up as an empty hulk in the middle of the village, similar to the unused Beechnut plant in Canajoharie, 28 miles away. Local officials are trying to redevelop that site, which is undergoing environmental remediation. “It’s like a ghost town,” she said of that site.
Remington is one of the nation’s best-known brands of guns, dating to 1816 when Eliphalet Remington began making flint lock rifles. The company thrived, expanding into a complete line of guns, as well as eponymously named typewriters, which were also made in Illion for a while. In addition to well-known hunting rifles, Remington supplies weapons for police and military, which earned their workers an “essential” designation during the pandemic, allowing the plant to keep producing. The plant also makes assault style weapons for the civilian market.
It was one of those rifles, the Bushmaster AR-15, which is similar to a military M-16, that Adam Lanza used in December 2012 to kill 20 first-graders and six adults at the Sandy Hook Elementary School in Newtown, Conn.
The onslaught of lawsuits from families of the Sandy Hook victims has been cited as one of the company’s challenges as it works through the bankruptcy.
But Remington has also suffered from the machinations of private equity buyers who loaded the company up on debt which has dogged them for more than a decade.
Remington in 2007 was acquired by Cerberus Capital Management, which was looking to consolidate what was a fragmented and highly traditional gun making industry. They bought Remington for $370 million including $252 million in debt.
Through its Freedom Group brand, Cerberus began buying other gun lines including Marlin and Bushmaster.
The purchase came just prior to the 2008 financial crash, followed by Sandy Hook in 2012, which created a backlash against gun makers.
Remington entered and emerged from an earlier bankruptcy in 2018 with ownership of the company transferred to creditors. An estimated $775 million in accumulated debt was written off at that time and Cerberus had left the scene.
Other challenges included difficulties in getting the Alabama plant started in 2014 and a reluctance by pension funds, which invest in many potential private equity firm purchasers, to be connected with weapons makers due to anti-gun sentiment.
The Navajo Native American nation in Arizona earlier in the year was looking at buying the company but decided not to. They also looked at it in 2018. One theory was that tribal sovereignty could help the Navajos avoid some of the lawsuit liability hanging over the company, but advisors concluded that wouldn’t be the case.
The debt helps explain why Remington, a well-known brand, is struggling during the recent Covid-19-inspired boom in gun sales.
Union workers at the plant say there are plenty of orders for their guns, but the company lacks the credit needed to get many of the parts.
Despite Cerberus’ earlier push to consolidate and bring efficiency to the industry, gun makers still rely on various parts from small machine shops, many of
which are in the Northeast.
For now, people in Ilion and the surrounding area are hoping the plant stays open, thus avoiding another episode in a slow-moving litany of plant closures and job losses in the Mohawk Valley.
It’s been a long but steady decline over the decades; Union Fork and Hoe, a garden tool maker in Frankfort; Duofold apparel in Ilion, and Beechnut foods.
In earlier decades, there was Daniel Green footwear in Dolgeville, and Univac computers, which left Ilion in the 1960s. “Americans have seen far too many of their jobs shipped out of the country, we do not want that to happen here yet again,” UMW president Cecil Roberts said in a recent letter urging the bankruptcy court do everything it can to keep the plants open.
There’s little question that a closure would hurt. “It’s hard to fathom,” said Rob Fiorentino, who in recent weeks opened up a coffee shop in the ARC mall. He has a similar operation, The Java Shop, in nearby Herkimer.
The one-story mall area, about three blocks from Remington, has struggled to draw businesses
over the years with a hair stylist, convenience store and auto parts retailer coming and going since the 1990s.
Outside the mall, as there are all over town, lawn signs proclaim that “United We Stand with Remington Workers, UMWA Local 717.”
Inside, on a bulletin board, was a poster advertising for people to apply for jobs as correctional officers in the state prison system. No written test was required other than the online application, it said.
Brown, whose bowling alley has been in his family since 1957, recalls the gun maker’s heyday decades ago when 2,000 people worked there. His bowling lanes would be packed with factory workers including some who would come in after their 11 p.m.7:30 a.m. night shifts to blow off steam. They are long gone.
On a recent morning, the lanes were quiet save for three or four older women who were bowling and sipping soft drinks.
Ultimately, though, Brown believed the plant would remain open. “I think it’s going to stay,” he said.