Newspaper article The Christian Science Monitor

A NAFTA Test Case: Manitex Tries Both Sides of the Border

Newspaper article The Christian Science Monitor

A NAFTA Test Case: Manitex Tries Both Sides of the Border

Article excerpt

FOR six years before free trade, Manitex Inc. made products at a Reynosa, Mexico, maquiladora and sold them to Mexico.

By the Jan. 1 advent of the North America Free Trade Agreement (NAFTA) that maquiladora had closed and the company was operating a new plant in the heart of Texas.

Former presidential candidate Ross Perot, who led the fight against NAFTA, predicted that its passage would cause high-wage manufacturing jobs to move south from the United States. Manitex could prove Mr. Perot wrong. Or it could be typical of industries needing low amounts of labor that can benefit from NAFTA while staying put.

Manitex, a maker of boom crane trucks - the kind that utility companies use to set poles for power lines and that roofers use to lift their materials to the top of building projects - is a subsidiary of Manitowoc Company of Wisconsin, a manufacturer of diverse engineered products with $300 million in annual sales. Ice cube machines for the food service and hospitality industry account for a third of revenues, says Manitowoc's president Fred Butler. "We also build ships, but there are no ships to build {right now}."

In 1982 the world saw "a virtual cessation of heavy construction business," Mr. Butler notes, and the company's crane business came to a "screeching halt."

In 1986, with eyes on the $80 million annual market for pedestal cranes used on offshore oil platforms, Manitowoc established Manitex, a twin plant operation based in McAllen, Texas, and across the border in Reynosa, Mexico. That year, oil prices collapsed. By 1987, when Manitex opened, the pedestal crane market had shrunk to $5 million a year.

SCRAMBLING for another product to make, the company chose boom crane trucks. These trucks cost from $60,000 to $180,000. Manitex and three other firms produce 1,500 to 2,000 a year for the North American market. …

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