Vertex CEO explains why company failed to meet promise of 1,300 local jobs

Vertex builds close to 2,000 rail cars a year (Source: WECT)
Vertex builds close to 2,000 rail cars a year (Source: WECT)

WILMINGTON, NC (WECT)

When Vertex Railcar Corporation first announced in 2014 it was opening headquarters in Wilmington, there was a lot of fanfare, including a visit from then Governor Pat McCrory for a welcoming ceremony. 

There was also a promise by Vertex CEO Donald Croteau that 1,300 local people would be hired with an average salary of $40,000. 

Fast forward to today and Vertex has yet to come even close to that number. 

While the company will not release an exact figure, Croteau says there are between 200-500 people employed at the facility now.  

He admits the company failed to make good on a promise. 

"I think everybody was disappointed, including us," Croteau said. 

Croteau says in order for Vertex to hire 1,300 people, the company would have to build 8,000 railcars a year. Right now, he says the company builds close to 2,000. 

When the announcement was made in 2014 that 1,300 people would be hired, Croteau admits he was banking on a much stronger oil market which would have created a greater demand for oil tank cars. 

"Between then and the end of 2015, oil went from $100 a barrel down to $30 a barrel so the market opportunity that was in front of us basically disappeared," he said.

Business has been on and off track since the facility off Raleigh Street opened. Oct. 6, Vertex officials announced a "temporary reduction in the workforce," stating in a news release that many of the laid-off workers would be called back. 

"It really is temporary in nature," the Vertex CEO said. "We don't like it, but it is temporary in nature and when they come back, all their benefits will still be in place as if they never left."  

Rumors have swirled that that company is on the verge of closing, but Croteau says that's not true. 

"I fight that with the City of Wilmington, New Hanover County every day, every week, every month, every year and I will tell you we are here for the long haul," he says.  

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