January 16, 2009 Volume 110 Number 2

Daimler (Freightliner) cuts 192 union jobs

Daimler Trucks North America (formerly Freightliner) opened the new year by announcing it will lay off 192 union workers at its Portland plant at the end of January and cut 2,137 production line workers from operations in Cleveland, Mount Holly, and Gastonia, North Carolina by the end of March.

Daimler made it known last October that it would cease making trucks at Portland’s Swan Island Industrial Park by June 2010 as part of a major restructuring plan. But the early round of cuts took union officials by surprise.

“I certainly didn’t see it coming; this was a surprise,” said Joe Kear, a business representative of Machinists Lodge 1005.

Workers in Portland are represented by four unions — Machinists Lodge 1005; Sign Painters and Paint Makers Local 1094; Teamsters Local 305; and Service Employees Local 49. A total of 163 Machinists were given pink slips, along with 33 Painters; 16 Teamsters; and seven Service Employees.

By June 2010, 700 additional family-wage jobs will be gone.

Daimler Trucks North America corporate headquarters will remain in Portland for now, the company said. About 1,900 nonunion workers are still employed in administration, product development, procurement, and information technology. In 2007, the sales, marketing, and customer support work was relocated to Fort Mill, South Carolina.

Portland production line workers were told Jan. 8 that orders for the Western Star brand truck were down dramatically in November and December, thus warranting the earlier-than-expected job cuts. Production has dropped from 17 Western Star trucks a day to just 10 trucks a day. The Portland plant also produces 10 military vehicles a day.

The plant once made all Freightliner trucks — with 3,000 union workers cranking out 112 trucks a day. But since 2000 the work has migrated in stages to plants in Mexico and North and South Carolina.

“Daimler is at the forefront in moving manufacturing work to Mexico,” Kear said. “The company says it’s market conditions, but the company isn’t downsizing in Mexico at a comparable rate. It doesn’t help to rebuild the U.S. economy by relying on imports, instead of building things here.”

By June 2010, all Western Star production will take place in Santiago Tianguistenco, Mexico. More truck manufacturing will begin later this year at Daimler’s brand spanking new 1 million-square-foot facility in Saltillo, Mexico.

This migration to Mexico is costing jobs in the U.S. and Canada.

In Mt. Holly, 572 members of the United Auto Workers will be out of work March 13 when the company discontinues production of Class 6 and 7 medium-duty Freightliner trucks. Daimler will eliminate 1,290 production line jobs in Cleveland, N.C., and another 275 jobs at its parts manufacturing plant in Gastonia, N.C.

About 1,400 members of the Canadian Auto Workers in St. Thomas, Ontario, Canada, also are losing their jobs.

In Portland, union officials and the company are meeting with affected employees to offer dislocated worker assistance, with help from Labor’s Community Service Agency, the Oregon AFL-CIO, and Work Systems Inc. The IBEW and United Workers Federal Credit Union is providing help with budget counseling.

Jobs cuts are based on seniority, and workers losing their jobs have been with the company anywhere from 10 to 15 years.

The unions’ collective bargaining agreement — which contains language calling for good faith bargaining on a severance package in the event of a plant closure — expires in June 2010. Kear said the sides intended to begin severance negotiations early this year, but bargaining for a severance package in Ontario is going slowly.

Kear told the Labor Press talks won’t begin in Portland until a deal is finalized in Ontario.

“These are extremely difficult and challenging times for our industry,” the company said in a statement. “We look forward to returning to normal production operations when business conditions stabilize.”

Kear: “It doesn’t help to rebuild the U.S. economy by continuing to put people out of work...by relying on imports instead of building things here."

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