Some learned the news on TV, others learned through a meeting, but one feeling workers felt Thursday morning was shock they no longer had jobs at Progressive Moulded Products Ltd.

Agnes Owusu and her husband, Johnson, are wondering how they will pay for their home.

“What are we going to do now? We didn’t get any notice,” Ms Owusu said. “I was watching television and I saw the Progressive sign and I thought, ‘Oh my God!’” Ms Owusu said, adding she was on a two-week vacation and thought she would go back to work July 14.

“There are many husbands and wives who work here,” said Ms Owusu, a technician at the plant for 14 years.

Among them are Fa Lim and his wife, Somalyna Meas.

Mr. Lim suffers from a disc problem in his back and is worried about finding new work.

“I dragged myself in here everyday with all my pain and medication and what did they do to me?” Mr. Lim said. “What are you going to do?”

For Veasna Svay, a 22-year employee, questions loomed about how things spiralled out of control to the point the plant had to be shut down.

“My question is: Where did the money go? I knew we were struggling, but last year we had $470 million in sales alone. We haven’t had any raises or bonuses over the last two years, but we accepted that,” Mr. Svay said, adding that his health benefits are also gone.

The company, which primarily made plastic parts for GM trucks, filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code June 20. Companies file under this and receive protection from creditors while they restructure their finances.

In a letter obtained by The Citizen to employees from CEO Dan Thiffault, the move was explained as one that gives the business a chance to restructure.

It cites problems in the auto industry and the company having borrowed a significant amount of money as reasons for the restructuring.

It also assures employees things will stay the same.

“Our plants are open and we intend to continue operating without interruption. We intend to continue serving our customers and working with our suppliers. And we intend to maintain existing staff levels, wages and benefits,” Mr. Thiffault says in the letter.

Company spokesperson Michael Daniher said they hoped to find a solution to the situation. Progressive employs 2,400 people, the majority of whom were based in Vaughan.

“It had been in discussions with key lenders and customers to find solutions to those challenges that would be acceptable to everyone concerned.

Unfortunately, those solutions were not forthcoming, key customers elected to move their business elsewhere and that, in recent days, compelled the company to undertake the drastic reduction in operations and the workforce that started happening a couple of days ago,” Mr. Daniher said. “It was just a response to rapidly unfolding events.”

Although the company had $473 million in sales last year, it suffered significant operating losses.

“When the Detroit Three (Chrysler, Ford and General Motors) are in trouble and they account for 90 per cent of your sales revenue, trouble can arise,” Mr. Daniher said, adding car sales have declined and costs have increased for materials suppliers use.

As for employees feeling like they’ve been hung out to dry, Mr. Daniher said the company regrets how quickly everything unfolded.

“Naturally, the company regrets the fact that there wasn’t the opportunity to provide greater information or more timely notice or update as to what was going on, but events began to unfold at a dramatic pace that the company had to react in similarly speedy fashion,” Mr. Daniher said.

Auto industry analyst Dennis DesRosiers of DesRosiers Automotive Consultants Inc., believes this downward trend will continue for a couple of years before any signs of  recovery.

“We would expect some kind of rebound, but not a hint of a turnaround until 2010 and, it’s probably 2012 or 2013 before it comes back fully,” Mr. DesRosiers said.

While he agreed a number of factors led to this particular closure, Mr. DesRosiers said the high level of debt the company was carrying is what ultimately led to its demise.

He also said that over the past 10 years, GM, Chrysler and Ford have been losing market share, so Progressive had fair warning that changes needed to be made.

But the impact on the local economy all depends on how reliant the area is on the auto sector.

Patrick Draper, York Region’s director of economic strategy, said the area’s economy is diverse, with burgeoning growth in the information technology and construction sectors.

“I don’t think it will have an impact on the economy at all, we are very broad-based,” Mr. Draper said.

There are 118 companies in the local automotive sector, compared with 492 in the GTA and 1,047 across the province. About 8,500 employees work in these area companies.

While analysts continue to theorize about the state of the auto industry, 29-year-old Todd Keast is looking for another job.

“The strike (GM) screwed us. We had no money coming in and out. I didn’t think it would get this bad,” said Mr. Keast, a nine-year Progressive employee.