Cumberland Kiwanis
Minutes of May 3, 2010
Ron Ruppel
Speakers: Ron Ruppel, Ardisam CEO
Topic: The Economics of ArdisamÕs Shift of
Manufacturing to China
President Deb Kunferman
announced that the scheduled speaker had to cancel at the last minute and
opened the floor for discussion by the membership. Ron Ruppel, CEO of Ardisam, took the opportunity to explain the
reasons for ArdisamÕs move of its manufacturing operations from Cumberland to
China. He titled his remarks ÒThe
Effect of Globalization on People.Ó
Ron first acknowledged the
effect on the community from the loss of employment. From about 200 full time and 100 part time workers, the
plant will reduce its workforce down to 50-70. The future staff will be well paid but will need a high
level of skills and training.
Lower skilled work is no longer viable.
Contrary to popular belief,
companies do not move operations to China primarily for cheap labor. China has artificially set its exchange
rate at 7 to 1, making materials that many times cheaper in China. Moreover, China pays a 17% bonus for
materials produced domestically.
Raw materials will not be exported with some Chinese Òvalue added.Ó As a result of this, the U.S. is
becoming a service economy. Even
cars assembled here contain 2/3 imported parts.
Ardisam will now focus on
sales and marketing. Hiring will
begin, but not for unskilled workers.
Only about 10% of the previous workforce will stay.
Finally, Ron expressed his
appreciation for the community support the company has received going back to
1991. He hopes to be able to
communicate to the citizens of Cumberland why the change in operations was unavoidable
and gain public understanding of why the move was made.