Welcome to the Business Journal Archives
Search for articles below, or continue to the all new BusinessJournalDaily.com now.
Search
YSD Industries Plans to Ride Rail Resurgence
By George NelsonYOUNGSTOWN, Ohio -- With its first order under new ownership due to ship out next week. YSD Industries Inc. is positioning itself to benefit from the resurgence in rail."We hope to grow," said Jerome D. Hines, YSD president. "The goal of our industry, and the railroad industry as a whole, is to take the traffic off the highways and to put it on the rail. In order to do that you need box cars, and to build box cars you need doors, and that's what we do best."Hines spoke Thursday morning at the regular meeting of the Mahoning County Commissioners, who approved a 60% tax abatement for nine years for the Austintown company. YSD was acquired April 6 by Global Railway Industries Ltd., a Canadian provider of railway products and service equipment. Founded in 1924 as The Youngstown Steel Door Co., YSD manufactures rail car components and is one of the largest suppliers in the design and manufacture of rail car doors and sides in the United States. Hines, who has 33 years in the railroad business, says he sees resurgence in the rail industry. He said his company plans to invest about $2 million in YSD, in addition to the $2.5 million paid to acquire the Austintown manufacturer. "I think one of the first things we're going to do is buy these guys new welders," he said. "They haven't had welders in 12 years and it's going to make them more efficient and do their job faster and better. That's a small investment." He said the company also plans to upgrade its heavy machinery, such as the 3,000-ton presses used in the shop. On Tuesday or Wednesday of next week, he expects the first order taken under YSD's new management -- a 100-door order for Norfolk-Southern in Linwood, N.C. -- to ship. He also said the company is going to diversify by getting into the repair business. Currently employing 35 workers in the shop and another 20 in the office, Hines said he expects to add another 25 jobs over the next three years. "But I think the business is going to grow and it probably will go a little bit higher," he added. "The way that the industry works, they bid the business in October and November for the following year so we lost all of 2004's opportunities. We are in the process of just piecemealing our business together this year, and I think we're going to end up quite well this year." YSD manufactures rail car components and is one of the largest suppliers in the design and manufacture of rail car doors and sides in the United States. YSD also supplies outlet gates for hopper cars, boxcar roofs, autorack side screening and roofs, and a complete line of stamped grating products. Sales were approximately $15 million in YSD's most recent fiscal year.An estimated 35,000 to 40,000 new rail car builds are expected in 2004, up from approximately 18,000 in 2003, according to Mike Kohut, chief executive officer of Global Railway. Historically, YSD generated as much as US $45 million in revenue annually during market peaks, he said. "Given the renewed strength in the new rail car market in North America, Global believes that YSD's growth potential is excellent."Hines said YSD Industries hopes to break even this year and be profitable in the fourth quarter. Visit Global Railway Industries at www.globalrailway.comContact George Nelson at [email protected]"