More closings at 84 Lumber
The building downturn has resulted in further cuts at 84 Lumber, which confirmed the closing of five additional stores in the last seven days. The locations are: Austintown, Ohio (near Youngstown); Sandusky, Ohio (in the Cleveland area); Lakeville, Ind.; Riviera Beach, Fla; and Chelsea, Ala. (The Chelsea unit was located across the street from a new 84 Lumber store and had been used as additional space.)
The Eighty-Four, Pa.-based lumberyard chain, which ranked No. 3 on the Home Channel News Pro Dealer Top 350 Scoreboard, also closed two truss plants, in McFarland, Wis., (in the Madison market) and Knoxville, Tenn., during the past week.
Areduction in head count has also been made at the corporate level; 28 positions were eliminated over the past three weeks. “There were cuts across the board, but most were in purchasing,” Jeff Nobers, vp-marketing and public relations, told Home Channel News. Director of purchasing Mitch Wagner still oversees approximately 40 people in the purchasing department, which was consolidated this past March, Nobers added.
84 Lumber now operates 329 stores and eight component plants in 161 markets in the United States, covering 37 states.
Former HD buyer leaves Chrysler
John Campi, the former senior vp–global sourcing and vendor management at Home Depot, is leaving Chrysler after less than a year on the job, the Associated Press reported. Campi, who resigned for health reasons according to an internal company memo, is the second high-ranking executive to quit the car manufacturer in four days, the wire service said.
The Detroit Free Press reported that Chrysler sat down with its key suppliers last week to discuss continued shipments as it appeals to the U.S. Congress for emergency loans. Campi’s resignation was announced at this meeting, the newspaper said.
Campi worked with Chrysler CEO Bob Nardelli at Home Depot, where the latter served as chairman, president and chief executive until Jan. 2, 2007. Both men are former G.E. executives. Home Depot announced Campi’s resignation on Jan. 15, two weeks after Nardelli’s departure.
At Chrysler, where Campi served as senior vp-purchasing, the executive emphasized cost reductions and directed a lot of sourcing toward overseas suppliers, according to a World Markets Research Centre report. He also oversaw “a newly litigious atmosphere that saw Chrysler file suit against several suppliers for issues that would previously have been worked out at a high level between the two companies, at worst,” the analysis said.
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November starts fall to 625,000
Housing starts dove 18.9 percent in November, according to data released Tuesday morning by the Commerce Department. New starts fell to a seasonally adjusted annual rate of 625,000, the lowest since the DOC began keeping track in 1959.
Compared to the November 2007 figure of 1.179 million new housing starts, the current figure marks a 47 percent year-over-year decline.
All four regions of the country posted double-digit negative percentage changes in both year-over-year and month-to-month comparisons. The most dramatic percent-change decline came in the Northeast, where November housing starts fell 59.8 percent compared to November of last year.
November stats fell well below consensus estimates, which had predicted starts to come in at about 740,000 units. In October, starts were revised to a record-low annual rate of 771,000 from 791,000 previously.
Building permits also declined in November, falling to 616,000. That’s down 15.6 percent from October’s figure, and down 48.1 percent from a year ago.
“The steep declines in home production that were reported today are in keeping with the extremely poor sales conditions that builders are seeing in their markets, as indicated by our most recent member surveys,” noted National Association of Home Builders (NAHB) Chairman Sandy Dunn, a home builder from Point Pleasant, W.Va. “Builders are doing exactly what they should be doing – they are actively reducing their inventories, virtually to the point of no longer building, in order to avoid adding more product to the marketplace. Congress and the Administration now need to do their part and ‘fix housing first’ in two ways. One is by stimulating demand, which will help put a floor under home values, and the other is by aggressively addressing the foreclosure problem.”
The Commerce Department report this morning follows on the heels of the record low reading of home builders confidence. The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) remained unchanged from November’s all-time low reading of 9. A reading above 50 indicates that more builders view sales conditions as good than poor.
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