KNOXVILLE, Tenn. -- The Dempster Systems plant, maker of the waste-management industry's 'Cadillac' dumpster, has been closed, permanently idling 250 workers who were on strike for months, the company said Thursday.
Krug International, the Dayton-Ohio based company that bought the plant from Carrier Corp. in 1980, announced in the closing in a statement from Chairman Maurice Krug.
He said the company has not been 'satisfactorily profitable' over the past six year. 'Falling productivity, environmental restrictions and huge rework costs have made it impractical to continue manufacturing ... despite extensive efforts to improve cost effectiveness,' he said in a statement.
Krug said certain sales and administrative functions will continue to be based in Knoxville.
The closing marks the end of a family era begun in 1933 by former Knoxville Mayor George Dempster and three of his brothers. They built the original Dempster Dumpster that came to be known -- true to advertisements -- as the 'Cadillac of waste-management systems.'
But worker strikes in the late 1960s and early 1970s -- including a 1975 strike lasting 18 months -- nearly brought the company to its knees. Carrier bought Dempster in 1970 but suffered from revolving-door management and a generally depressed market for the green trash hoppers.
Krug bought the troubled company from Carrier in 1980 for an estimated $9 million and was intent on turning the company around. In 1981, Krug said he was 'not any smarter than Carrier, but Dempster means more to me than it did to them.'
Workers at the plant had been on strike since December when they rejected a proposal to cut benefits and wages, which averaged $9.59 an hour, by $3.09.
George Hackney, who put in 20 years at the plant and is president of the United Steelworkers Local 3165 that represents the workers, said, 'The shame of it is that we've got some older people here who've put in a lifetime with this operation,' Hackney said. 'They're the ones I'm concerned about.'
'The newest employee on the Dempster payroll came on 16 years ago,' Hackney said.
