The Wabash Cannonball, if you will, is rolling into Little Falls to the delight of the job-hungry locals.
Indiana-based Wabash National, a growing maker of high-test, lightweight truck trailers, has acquired for $3 million the just-shuttered Larson Boat plant, a nearly century-old business in the central Minnesota town.
Early this year, once bankrupt Larson Boat, under pressure in a declining industry, closed the Little Falls plant where it had operated since 1925, idling 114 remaining jobs at a facility that once employed hundreds. (Founder Paul Larson built his first boat in 1913 and later made duck and fishing boats for his friends.)
Wabash National said last week that it will invest $11 million to renovate and equip the plant on a vast 53-acre site on the Mississippi River, with plenty of room for expansion. The company has pledged to employ 70 by 2019 and 100 or more within five years.
Workers will make the company's next-generation "molded structural composite" interiors for refrigerated and other trailers.
Mayor Greg Zylka said Wabash has been more optimistic in private about its expansion and hiring plans for a workforce that will start at $18.18 per hour, a good wage in Morrison County, plus health benefits, vacation and a 401(k) retirement plan.
"They are a large company with financial backing, and I believe there are vendors who will follow them here eventually," Zylka said. "They were conservative in saying they'll hire 50 to 75 in the first year or so.
"They also have talked about assembling actual trailers at the Little Falls plant. We're optimistic."
Wabash officials declined to comment on whether the plant may grow faster than projections. However, Dustin Smith, vice president for Wabash's commercial trailer products, said Little Falls is ground zero for its next-generation trailer-interior product.
"We selected the Little Falls location as the launch facility for molded structural composite products because of the unique combination of an experienced and highly skilled workforce in composite manufacturing processes, along with a fully equipped and highly engineered facility capable of producing large-size parts at high rates of volume," Smith said in an e-mail. "We are excited to be a meaningful and positive contributor to the community. Our first cohort of new associates began orientation [last] week."
Publicly owned Wabash National, which says it is North America's "leading producer" of semitrailers and refrigerated transportation systems, reported record operating income of $202.5 million on net revenue of $1.85 billion in 2016.
The company says its "advanced composites" technology, to be rolled out in Little Falls, will improve on its already lightweight, energy-efficient trailer and truck lines and other yet-to-be-announced products. Molded structural composites are lightweight manufactured plastics that become interior thermal panels and doors. Wabash National's Cold Chain series of truck bodies is made of composites that it says improves thermal performance, keeping products colder with up to 25 percent less energy. They're said to be more durable and lighter than standard products.
"We remain committed to transforming Wabash National into a more diversified industrial company with a broader array of products and services," Brent Yeagy, chief operating officer, said in a statement. "Our expanding portfolio of composite offerings is instrumental to that goal."
The state of Minnesota is providing nearly $1 million in loans and grants to Wabash National, tied partly to hiring goals. "We're very excited to see a large … industry leader like Wabash National set up operations in Greater Minnesota," Shawntera Hardy, commissioner of the Minnesota Department of Employment and Economic Development, said in a statement. "This is particularly good news for Little Falls and Morrison County, which have … higher than average unemployment rates."
Larson was once part of Minneapolis businessman Irwin Jacobs' Genmar boat complex that went bankrupt during the Great Recession of 2008-09. A buyer bought several other lines out of bankruptcy but didn't want Larson. The city provided Jacobs a $1.8 million loan package, averting shutdown.
Larson has consolidated operations into a Pulaski, Wis., plant. And some employees transferred to Wisconsin.
"Irwin never missed a payment and has paid us off," said Carol Anderson, the community development director in Morrison County. "Irwin sold the facility to Wabash National for about $3 million, and he still owns Larson and the facility in Wisconsin.
"And Wabash National is investing $11 million. There's no downside to this. I think this company will grow. Wabash will train the employees. Wabash likes the facility. And we have skilled people. Once they hit critical mass, we can help their suppliers locate close."
The Larson plant also manufactured boats using composites. The workforce, good-quality plant and up to 600,000 square feet in manufacturing and storage space made it a fit for Wabash National.
About 33,000 people live in Morrison County, an agricultural and forested land. Little Falls, the county seat, has a population approaching 10,000.
It's part of the several-county Region 5 economic development area of the state in which manufacturing jobs are more than 10 percent of local jobs. The average pay last year was about $15 an hour, according to state statistics.
The Wabash plant will add to the growing rural manufacturing corridor between Elk River, about 20 miles northwest of Minneapolis, all the way to Alexandria, 135 miles away in the central-lakes region.
Local and state officials say the Wabash National move into Minnesota, with 100-plus good jobs, with the chance for more, is further evidence that the industrial partnership between the state, local technical schools and colleges is working in producing skilled employees who are attractive to value-added manufacturers.
Neal St. Anthony • 612-673-7144
