Mercedes offers buyouts to Ala. workers
Mercedes offers buyouts to Ala. workers
Automotive News | October 31, 2008 – 4:18 pm EST
Mercedes-Benz is offering buyouts to nearly all 4,000 employees at its Alabama auto assembly plant, a spokeswoman confirmed today. The buyouts, announced to employees yesterday come before another round of production cuts at the factory that will begin in January.
“We’re going to be making operational changes to align the plant’s production volume with expected market conditions and the downturn in the economy,” said Felyicia Jerald, a spokeswoman for Mercedes-Benz U.S. International Inc.
The Alabama factory, which produces the GL-class SUV and M-class and R-class crossovers for worldwide markets, went to a four-day workweek beginning in October.
Earlier this week, Mercedes officials said the Alabama factory would not be affected by a decision by parent company Daimler AG to shut 14 Mercedes plants in Germany beginning Dec. 12.
Besides the reduced schedule begun in October, the Alabama factory will shut two days earlier than planned in December, Jerald said today. The last production day for 2008 will be Dec. 16.
She would not say how the reduced production schedule will affect total output. In 2007, the Alabama plant built 174,356 vehicles.
Bill Taylor, president of Mercedes U.S. International, told The Birmingham News in an article published today that the automaker is going over options for the Alabama factory.
“We are studying our product portfolio for this operation here in Alabama,” Taylor said in an interview Thursday, adding that the factory was on track to launch a hybrid version of the M class next fall.
This is the first time Mercedes has offered buyouts to workers at its Alabama factory since the plant opened in 1997. Jerald said the buyout packages are being extended to all workers, excluding management. Temporary workers were told in September that they would not be needed after Dec. 31, she said.
Jerald emphasized that the buyouts are not layoffs. And while the packages are being offered to nearly all of the plant’s workers, Mercedes will limit the number who are allowed to accept the packages.
“It’s not a huge number, but I can’t give you the exact number,” Jerald said. “We have some other options we’re looking at, so we’ll bring our team members back before the end of the year to tell them what 2009 will look like.
“These steps are unusual for us, but we’re going to continue building Mercedes-Benz products in Alabama.”
A Birmingham, Ala., news radio station reported today that Mercedes plans to cut a production line, affecting “hundreds of jobs.” The station, WERC 960, said employees have until Nov. 10 to accept the packages, which include a $45,000 lump-sum payment plus $1,000 for each year of service.
Jerald declined to confirm the specifics but called the package a “traditional offering” that includes a financial component, assistance with health care and other elements.
