A Hixson company is adapting to a changing international manufacturing landscape and finding ways to grow, which includes importing at least 10 to 15 jobs from China, an official says.

“The cost of moving product is too expensive,” Scott Klosterman, president of the Chattanooga Group, said about Chinese imports.

Long before fuel prices rose to record highs, Chattanooga Group was planning on moving the metal fabrication of physical therapy tables from China to Hixson, Mr. Klosterman said. The company’s parent, California-based DJO Inc., believes in doing work in house when possible, he said.

Staff Photo by Kelly Wegel
Welder Crandall Green works with the Daihen robot welding machine, shown behind him, at Chattanooga Group in Hixson on Monday. Chattanooga group recently merged with DJO and purchased new machinery, including the welder robot, in order to be prepared for the growth of the company, said marketing and communications manager Andrea Irvin. Chattanooga Group manufactures rehabilitative equipment.

But high fuel prices have made the China decision yet more profitable, Mr. Klosterman said. Six months ago one container of parts from China cost $4,000, he said. Now, the cost is $6,200, the official said.

Currently, the table frame is shipped from China and assembly happens in Hixson, Mr. Klosterman said. The cushions are made by a Dayton, Tenn., company, he said.

Sometime in the coming year Chattanooga Group will start fabricating and assembling the table in-house, he said. Chattanooga Group has been losing market share to competitors, he said, but the new Adapta line, which recently became available for sale, should reverse the trend, Mr. Klosterman said.

Chattanooga Group will manufacture the table using the lean assembly concept, he said, in which product is made to fill specific orders and few components or finished pieces are left laying around the factory. The company has added a $100,000 refurbished robot welder and a $500,000 laser cutter in preparation for the jobs from China, Mr. Klosterman said.

Also, the company is looking to use the laser cutter to make parts in-house that it has been outsourcing domestically for a decade, Mr. Klosterman said.

Overall, Chattanooga Group has added $1.5 million in equipment for jobs that are coming in the next 18 months, Mr. Klosterman said. The moves are spurred by a changing international manufacturing landscape as well as internal changes by DJO, which last November bought Chattanooga Group’s former parent, Encore Medical, he said. The acquisition doubled DJO’s size, the official said.

Chattanooga Group this week laid off nine people from its sewing department and previously reassigned 10 sewers to other departments, Mr. Klosterman said. Three of those laid off are taking early retirement with their severance packages, he said, and the rest may be called back later for new jobs. The company is retaining a few sewers to do small, niche work, he said.

The company currently has about 302 workers and expects to have 330 by next summer, Mr. Klosterman said. In 18 months Chattanooga Group will have about 350 workers.

The remainder of the sewing will be done at a factory in Mexico, Mr. Klosterman said. That company was named the 16th best place in Mexico to work, and has 2,000 workers and 700 sewing machines, he said. Chattanooga Group had 20 machines.

Chattanooga Group also will begin early next year making the Defiance line of DonJoy braces for rehabilitation and preventative use for the public and for athletes, said spokeswoman Andrea Irvin. DJO is a world leader in braces, she said, and is known for its sports line, in which braces can be personalized by color and pattern for teams. The straps will be made in Mexico, but the braces are fabricated and assembled here, she said.

“It’s just more efficient to make it here,” Ms. Irvin said.

Chattanooga Group also has a Red Bank operation with 30 staff who will be moving in September to Hixson, Mr. Klosterman said. That site makes the company’s original product, stainless steel heaters and coolers for hot and cold packs used in therapy, he said.

Comments