RBC Bearings Inc. (USA; NASDAQ: ROLL) is closing its long-troubled Tyson Bearing plant in Glasgow, Kentucky.

Founded in 1929 by Frank Tyson to produce full-compliment tapered roller bearings, the company's first plant was in Massillon, Ohio, not far from Timken headquarters.

Following World War II, Tyson followed market demand and added standard tapered roller bearings for truck and industrial markets.

In 1955, Tyson was acquired by SKF AB (Sweden).

Beginning in the late 1950's, U.S. automakers gradually began changing over their front wheel bearings from ball bearings to tapered roller bearings. By 1965, the changeover was virtually complete; Tyson's tapered roller bearing business was booming.

SKF responded by building a second Tyson bearing plant, this time in Glasgow, Kentucky.

Initially, Glasgow's output was dedicated to a short line of high-volume tapered roller bearings for those automotive front wheel applications. Demand continued strong and the plant was expanded in 1976.

The U.S. recession in the early 1980's triggered a realignment at Tyson. In 1981, the Tyson brand was discontinued in favor of SKF's single branding strategy and an increased focus on the less-commoditized and more profitable heavy duty market.

Massillon was closed in 1985 and all production shifted to Glasgow as the SKF Tapered Bearing Division.

The Glasgow plant continued to go downhill, however. In 1998, SKF took a $4.8 million loss on the plant and announced it would sell or close Glasgow within the year.

In 1999, RBC paid SKF $10.2 million in cash for the Glasgow Tapered Bearing division. In the process, RBC revived the Tyson name. Also included in the Tyson lineup is the former L&S / American Bearing / Driveline Technologies plant in Oklahoma City, producing tapered thrust bearings.

article: RBC / Tyson acquires SKF Glasgow plant
Following the Glasgow acquisition, RBC laid off half the plant's 260 workers, leaving 130. A large number of those who came back to work for RBC were SKF retirees, drawing an SKF pension and working for Tyson at a reduced hourly rate.

Tyson has had a history of going through increasingly rough cycles of difficult times, tracking to its core Class 8 truck market.

In recent years, several of the company's competitors told eBearing they felt Tyson had become marginalized, no longer strategically or technologically positioned to compete effectively, especially as heavy duty and Class 8 chassis suppliers have become increasingly multinational.

In fact, Tyson's demise comes after a year in which Class 8 trucks scored their largest sales increase in many years -- driven by preorders to beat EPA-mandated cleaner running diesel engines.

The Heavy Duty Manufacturers Association (HDMA) recently reported 2006 Class 8 truck sales were up 12% over 2005, hitting 284,000 units from 252,800 in 2005. Overall Class 4 through Class 8 sales were up 8.4%. HDMA CEO Tim Kraus, said: "Large fleet operators are trying to avoid a $7,000 to $12,000 price per truck increase" related to the higher procurement and running costs of cleaner burning diesel engines mandated by the EPA in 2007.

The 2006 "preorder" jump also includes significant inventory buildup by truck manufacturers in advance of the new engine regulations. By December, 2006 Class 8 truck inventory had been built up by more than 22% over 2005.

The effect of these preorders and advance inventory builds, however, are expected to be reflected in a near-collapse of heavy duty production in 2007. Suppliers are already warning of difficult times ahead, with 2007 production forecast to drop as much as 45% before a modest recovery in 2008 and 2009. By 2009, truck manufacturers say they will have hybrid diesel-electric Class 8 trucks on the road, offering diesel fuel savings of 30% or more and igniting fleet demand again.

Approximately 85 workers were left in Glasgow when RBC made the decision to close the facility.

The plant will be shut down by March 6.

Linda Hester, HR Manager at Glasgow, said: "With the economy the way it is and foreign competition the way it is, we can't compete with the Chinese. We've been feeling the effects for some time now."

Tyson is the second RBC plant closing in recent months, following Nice Ball Bearings, both of which were acquired from SKF. Nice production was relocated to New Jersey and North Carolina.

article: RBC closing Nice Bearings
article: RBC finalizes Nice facility sale
RBC has said it will continue to produce Nice brand bearings but did not comment on the fate of the large tapered roller bearing product line or the Tyson brand name.