07/25/08 — Reuel Inc. will add 50 jobs at local plant

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Reuel Inc. will add 50 jobs at local plant

By Steve Herring
Published in News on July 25, 2008 1:58 PM


News-Argus Staff Writer

A nearly $3 million expansion project is expected to secure Reuel Inc.'s standing as the nation's second-leading supplier of molded electrical insulators, while opening the door on a new venture -- building power traction units for the nation's light and heavy rail transit systems.

It also will create as many as 50 jobs, said the company's vice president and general manager, Larry Davis.

Davis said Reuel could realize $20 million a year in volume sales for power traction. He estimated that over the next decade the power traction business could become a $100 million-to-$200 million market.

Construction of Reuel's new 33,000-square-foot building on Dewey Street is expected to be completed next month and renovations to another 14,000-square-foot building have been completed.

Meanwhile, the company is making use of existing space to complete the first of its new line of traction power equipment for light and heavy rail mass transit systems.

The first unit, expected to ship by mid-August, is headed to New Orleans for the city's trolley system to replace units destroyed by Hurricane Katrina. A second unit will follow within two months

Other equipment being built is destined for New York City. The company was recently notified it has won a large contract in Denver.

Reuel started out as a business serving original electrical equipment manufacturers with electrical parts primarily used in medium-voltage switch gear and transformers. The company is known as a molder of electrical insulators and sports a line of more than 120 such products.

"A lot of switch gear is custom, so every item we make is like a new item for us," Davis said. "Companies send us drawings, and we make the tooling for them and make the part."

Davis said Reuel has grown steadily since its inception, diversifying into building switch gears and making many of the molds used in the molding products business. The company currently has 51 employees. About 15 work in the traction power division.

The company added the traction power equipment facet last August when it purchased the division from IMPulse, NC in Mount Olive.

Joining the company as vice president of the traction power was Tom Young, one of the founders of IMPulse, and who is well-known in the power traction business.

"There is a lot of work in the U.S. at moment," Davis said. "Practically everybody who has an existing (rail) system is talking about expanding it and a lot of new systems are coming out for bid. We do quite a bit of work for New York and we are bidding on jobs. We have been told we will get the Denver contract, a big one, for 12 substations."

The company is also bidding on projects in Hampton Roads, Va., and in Houston.

"Even though he (Young) had left IMPulse several years ago, he is still very much connected in the business," Davis said. "He knows where to go to get them (jobs), and we picked up a couple of key IMPulse reps who have pretty much come to us with the jobs. So far all of the jobs we have gotten have been through these guys so it has been no problem following the market."

The former IMPulse employees have played other roles as well. Reuel officials were in Europe last year to look at a molding machine the company could use. The machine had a $400,000 price tag and delivery "was way out there," Davis said. After looking at the machine, Reuel workers were able to design and build one locally for about $100,000.

Now in its 21st year, Reuel started out with 5,000 square feet of space. With the additions the company will have about 110,000 square feet of space.

"We felt real good about it (expansion)," Davis said. "We felt it would be the definite wave of the future and there is limited competition. We had the makings of putting together a pretty good team from existing people in the area. All of that has been a major contributor to all of the success that we have had so far."

"When this building becomes functional we are going to see some great things happening and of course with the public transportation business and gas prices like they are we are excited for Larry to have the opportunity," said Mike Haney of the Wayne County Economic Development Alliance.

Reuel received a $100,000 grant through the One North Carolina Fund for the project. The grant required matching contributions from the city and county.