Daimler cuts truck jobs as growth falls

[kscarbel]

The Financial Times / January 30, 2013

Daimler cuts truck jobs as growth falls

Daimler Trucks, North America’s biggest truckmaker by sales, plans to cut 2,100 jobs, including 1,300 in North America, as the US economic slowdown starts to feed through to demand for commercial vehicles.

The company, whose Freightliner, Western Star and Thomas Built (school bus) brands account for about a third of North American heavy truck sales, is the first large truckmaker to announce redundancy plans since the U.S. market’s rapid growth started to slow.

Daimler Trucks North America employs almost 20,000 workers in North Carolina, South Carolina, Oregon and Mexico.

Just a year ago, Freightliner’s Cleveland, North Carolina plant said it would recall almost 1,100 workers due to rising demand in the U.S., Australia, New Zealand and South Africa (exports largely included right-hand drive Argosy II COEs), but only half that amount were rehired – demand didn’t rise as forecasted.

The remaining 800 job losses would come from Daimler Trucks’ 27,000-strong workforce in Germany. Those jobs are disappearing as work on some long-term projects dries up.

More details about the North American job losses would be announced on Thursday.

The planned cuts at Daimler Trucks are likely to be only the first of many as the North American truck industry adjusted to a slowdown in demand growth that had started last year, said Ken Kremar, a capital goods analyst at IHS

“Indications are that most of the major trucking companies have decided to tread more lightly in terms of major equipment purchases,” Mr. Kremar said. “What you’re seeing from Daimler is a reduction in employment just to deal with the fall-off in demand that they anticipate in the early part of the year.”

IHS expected the heavy truck market to continue growing by about 5% during 2013, Mr. Kremar said. But that is a significant slowdown from the 13.6% year-on-year growth of 2012 and the 60% growth in 2011.