Gist Leads Tennessee Company to Success Despite Turbulent Times
It took only one visit to an auto manufacturing giant’s Detroit, Michigan, plant for Andre Gist to know he had a future in the industry. And during that open house at his father’s workplace at the Buick engine plant, Gist also knew his place in the scheme of things would be upper management.
“Just about everyone in my family worked in the automotive industry — even my aunts and uncles worked for Buick or Chevrolet,” Gist says. “I visited a plant with my father, and I realized I didn’t want to work on the floor. I wanted to be on the other side. I knew I wanted to go to college.”
That impetus took Gist to Bowling Green University in Ohio, where he majored in mechanical manufacturing engineering technology. He moved from Detroit to Tennessee in 1998 to partner with Oliver Isaacs, Dick Habib and John Zardis in their own firm, Manufacturers Industrial Group (MIG), which eventually became the state’s largest minority-owned business.
The path to success was difficult for Gist, who strove to keep the company afloat as CEO during the devastating economic downturn of the mid-2000s. The business not only survived, but emerged from the turmoil on the crest of a new wave of growth and vertical integration through its welding operation.
That vertical integration “allowed us to become the experts in the welding process,” says Gist. From sales of around $35 million in its early years, “We became Johnson Controls’ largest supplier worldwide,” he says. “And by 2014, we had products in 51 percent of every vehicle manufactured in North America with roughly $370 million in revenues annually. With each acquisition, our revenues increased.”
MIG was begun in Lexington, Tennessee as a key supplier for Johnson Controls-ASG. “They had two facilities — one in Linden, Tennessee, and one in Lexington,” Gist says. “We supplied various OEMs, but we came to support those two (plants) by producing welded assemblies for seat cushions or seat tracks. We started with manual adjusters, then grew into producing every mechanism under the seat and inside the seat – the recliner, the cushion frame, the back and the power and manual tracks.”
Gist and another partner, Zardis, bought the business in 2002 and Gist became CEO. Two years later, he then became the majority owner and continued as CEO.
The company bought its second Johnson Controls plant in 2007, a 234,000-square-foot facility in Lexington that enabled the company to add power adjusters and recliners to its product line and fine blanking and roll-forming process capabilities. Also that year, MIG developed a metal fabrication division and spun-off a construction services wing.
That was followed by the 2009 purchase of supplier Modern Industries in Chattanooga, which was renamed MIG Wire and Tube. That purchase gave MIG the ability to form wire and bend tube to the partners’ repertoire. In 2010, MIG bought two Johnson Controls stamping facilities, located in Athens, Tennessee, including 580,000 square feet of manufacturing space, making MIG the largest minority-owned stamping business in the country.
At that juncture, the company’s vertical integration included stamping, wire, welding and assembly of all of its own products.
Until recently Gist remained at the helm of the ship he co-founded and steered through those rough seas of national financial unrest. But at the end of 2014, he sold back the plants to Johnson Controls, retaining ownership of MIG Wire and Tube in Chattanooga and MIG’s steel fabrication interests in western Tennessee.
“At the time, Johnson Controls had changes in leadership and thought it would be a good move for them to put more interests in the South — also with the intent of providing more support to the plant in Mexico,” Gist says. “They made an offer to allow them to put a bigger footprint back in the South.”
Gist turned his attention to growing a steel fabrication plant for the construction industry to build facilities such as schools, hospitals and hotels. “I wanted to diversify,” he says. “We had all of our business in automotive, so I started looking at skills in metal working and metal replication. When we sold the plants in 2014, I put more emphasis on the construction side.” His partner moved to Chattanooga to oversee MIG Wire and Tube, while Gist stayed in western Tennessee.
After college and before moving to Tennessee, Gist worked for a metal stamping company in Detroit for two years before moving on to General Motors to work on front end and rear bumper systems at the Michigan plant. Then he was hired by Ford to work in the door manufacturing department for about a year.
From there, Gist joined Johnson Manufacturing in Taylor, Michigan, before he began working for a small supplier to Johnson, which manufactured seat panels, primarily for Chrysler’s Jeep Wrangler and Jeep Cherokee.
“When the opportunity presented itself for me to be my own boss, I took it,” Gist says. “After you’ve worked for other people, you start seeing your own strengths and feel like you can do things as well or better. By learning from different managers and learning the different processes the larger corporations were using, I thought I could use those skill sets and tools to operate a company myself.”
Those skills served Gist in good stead, especially when the economy tanked in 2008, dragging much of the industry into rapid decline.
“It was a tough economic time,” Gist says. “It was extremely scary for me and my family and all the employees, as well. We were getting reports daily of all the bankruptcies in the automotive industry and were really nervous about it. We had no idea how we would be affected, but there was so much concern everywhere that we had to provide our financial statements to the bank.”
Those reports were first required quarterly, and then the bank asked for them weekly. Every two or three days, Gist would have conversations with the company’s bankers to discuss their status.
“When they weren’t comfortable, they wanted to know what we were doing to reduce our costs,” he says. “We dropped our salaries completely, and had a 10 percent cut of salaries across the board.”
Layoffs followed, the most painful part of the process, Gist says.
“We had to lay off some employees who had been with the company since inception,” he says. “It got that desperate. We reduced all the costs we possibly could. We had a good relationship with our bankers, and they hung in there with us. We knew if GM filed regular bankruptcy, we would last about two days. It was pretty scary. We came through it, and a year later, we purchased the stamping facility.” Going through the crisis taught Gist how to find leaner and more efficient ways to operate and improve the entire process, making the plants optimal performers when Johnson bought them back. Gist is now running two companies.
First is MIG Steel Fabrication, with 46 employees, an office in Nashville, an office in Memphis, and a fabrication plant in Lexington. Formerly known as MIG Construction services, the company provides steel fabricating services for commercial, industrial and medical construction markets.
Second, Gist also runs his automotive start-up company, B-G Innovative Safety Systems, which manufactures cutting edge headlight sublimate safety systems for passenger vehicles and heavy trucks. It now has two employees.
“It is truly a start-up,” Gist says. “We have a patent, and our unit is going through some cost savings analysis and finalizing on testing. We’re 97 percent complete and hoping to have a manufacturing decision made by the end of the next quarter.”
Conversations are in the works with a couple of companies interested in the prototype, as Gist refines his marketing plan and makes engineering tweaks. With his long history in Tennessee’s automotive industry, he has the foundation and contacts to take this product to the next level.
A native of Flint, Michigan, once known as Buick City, Gist has long been on the board of directors for the Tennessee Automotive Manufacturers Association, supporting industry in the state for 23 years. He served as president of TAMA for five years and is the longest running member of the board of directors with an 11-year tenure.
“The group has really grown over the years, and now we have a full-time president,” Gist says. “We’re making major strides and have Tennessee’s academic and economic development communities involved. We’ve improved our relationship with the universities, and we’re getting more OEMs involved. Nissan was one of the first OEMs to help get the organization started 26 years ago.”
Gist says the aim is to get still more to sign on. Bridgestone and Volkswagen are among big-name members, along with many medium to small suppliers in the automotive industry.
“We’re really looking to beef up services and information to help provide our members with what they need,” says Gist, who has been a strong proponent for TAMA for 23 years. “Part of my job is to talk to other suppliers, especially because I’m one of the few on the west side of Tennessee. We want to see our membership grow and get more suppliers from this side of the state involved. Tennessee is the place to be now with all of the growth in the automotive industry.”