Freightliner Ousts General Manager of North Carolina Plant

[kscarbel2]

Transport Topics  /  July 20, 2016

During a tough time for the trucking industry, the Freightliner plant in Mount Holly, North Carolina, has gone through a leadership change this week.

General manager Mark Hernandez is no longer with the company, a spokesman confirmed July 19.

Hernandez joined the plant in December 2011.

His job description states he managed a budget of $350 million.

The Mount Holly plant produces medium and heavy trucks.

Hernandez’s responsibilities will be shared by plant logistics director Jane Rosaasen and production director Janine Wright, Daimler Trucks North America (DTNA) spokesman David Giroux said.

Giroux said he could not comment on whether Hernandez was fired or if he left on his own.

Hernandez has been with Daimler since at least 1994, six years after he graduated from the U.S. Naval Academy.

He managed the company’s plant in Saltillo, Mexico, for 17 years before moving on to the Mount Holly plant.

While with Mount Holly, he managed the Cleveland plant in Rowan County for seven months, starting in November 2014. That plant is Freightliner’s largest in the nation.

The two women who take on Hernandez’s responsibilities have long careers in the auto industry.

Janine Wright has worked for Daimler since at least 1984. She started as a design engineer and spent at least 17 years at the Mount Holly plant.

Jane Rosaasen, has worked for the company since at least 2004, starting in human resources and working at plants in Rowan County and Mexico. Before working for Daimler, she spent 20 years with Chrysler in the automaker’s Canada division.

In June, Daimler announced layoffs for its Mount Holly and Gastonia plants. Mount Holly lost 600 workers, reducing it to one shift. Gastonia, which fabricates and assembles parts for Daimler products, lost 200. The company previously stated the temporary layoffs were part of an international reduction in workers. Daimler expected a 15% decrease in sales of medium and heavy trucks, the kind of trucks made at the Mount Holly plant.

Truck manufacturing follows a cycle that relies on factors outside a company’s control, Gaston County Economic Development Commission executive director Donny Hicks previously told reporters. As one of the largest employers in the county, Freightliner pays a large amount of tax and provides work to local suppliers of smaller parts that go into truck components, Hicks said.

Recently, Volvo and Mack also have laid off workers nationwide.

In February, about 700 workers were temporarily laid off, reducing the Mount Holly plant to two shifts a day.

About 300 laid off workers attended a March job fair hosted by the county, but it’s not known how many of those workers found new jobs.

Officials with United Auto Workers Local 677, which represents the Mack workers, did not respond to requests for comment July 19. The union is negotiating with Mack, since the existing contract expires in early October.

One positive of the nonproduction time, according to the announcement, is it allows the company to more easily do work related to Mack's $70 million investment in the plant, a project aimed at modernizing the 40-year-old structure and turning it into a "world-class manufacturing facility." The letter said Mack plans to conduct maintenance, do construction work and make improvements to the facility during the shutdowns.

When the employees do return to work, they're not likely to find a bustling truck market reminiscent of 2015, when Mack delivered 27,411 trucks, its strongest year since 2006. That's something Volvo realizes. In its report July 19, the group lowered its heavy truck market forecast for 2016 to 240,000 trucks.

By comparison, the total North American retail market for heavy-duty trucks was 301,700 last year.

"A continued good development in the economy, low fuel prices and low interest rates support the market, but with stagnant freight volumes, increased availability of competitively priced used trucks and less need for fleet renewal, the market is expected to settle on a more normal level during 2016," Volvo said.

In a July 6 report, Stifel transportation analysts said North American heavy truck orders of 13,100 units in June was the lowest level since the third quarter of 2010.

In terms of North American heavy-duty truck production, Stifel is forecasting 230,000 units in 2016, 205,000 units in 2017, 200,000 units in 2018 and 250,000 units in 2019.

"We continue to believe there is more risk to the downside than upside in the next few years, especially for those names that are most exposed to the North American heavy-duty cycle," the Stifel analysts wrote. That means this could be a sign of things to come at Mack, which had 93% of its second-quarter orders and deliveries in North America.

[kscarbel2]

Mark Hernandez and Wade Watson should get together for lunch and exchange stories.