Southeast Side manufacturing plant to close after losing Ford contract

A Southeast Side manufacturing facility will lay off hundreds of employees and close permanently after failing to secure a contract to supply a nearby Ford Motor Co. assembly plant.

ZF Chassis Systems, 3400 E. 126th St., has provided suspension modules to the Ford plant since 2004. A total of 261 employees will be affected by the time production ceases in March. ZF notified the state of its plans last month.

The company said it has been preparing employees for a year now.

“We have transitioned most of the salary and hourly employees to a couple of locations,” Tony Sapienza, ZF Chassis spokesperson, said. “Some have gone to work directly with Ford, some have gone to the new supplier who now has the business and some have gone to other ZF locations.”

Sapienza couldn’t provide a breakdown of how many employees went where or who the new supplier is. However, employees who have not moved to a new employer by the time the plant closes will receive a severance package agreed upon with United Auto Workers Local 3212.

Union representatives did not respond immediately to a request for comment.

“Ford selected a different supplier for the new contract for the new model … and as a result, we didn’t need to keep that plant open,” Sapienza said.

Ford announced earlier this year it planned to cease production of its Taurus sedan, which has been manufactured at its Chicago plant, 12600 S. Torrence Ave., since 1986. ZF Chassis has supplied suspension modules for that car, but Taurus production ends in March – as the ZF Chassis’ layoffs begin.

About 5,290 people are employed at the Torrence Avenue Assembly Plant on the Southeast Side and the Chicago Heights Stamping Plant in the south suburbs. The Torrence Avenue plant is shifting to focus on sport-utility vehicles, including the next-generation Explorer and the mechanically related Lincoln Aviator.

The German-based manufacturing plant has complied with the Illinois Worker Adjustment and Retraining Notification Act by providing the state with 60-day advance notice of its planned closures.

Manny Ramos is a corps member in Report for America, a not-for-profit journalism program that aims to bolster Sun-Times coverage of issues affecting Chicago’s South and West sides.