6,000 DaimlerChrysler Jobs at Risk

Monday, July 12th 2004, 12:16 pm
By: News On 6

STUTTGART, Germany (AP) _ DaimlerChrysler will move production of future versions of its Mercedes-Benz C-Class cars away from the company's biggest German plant _ costing 6,000 jobs _ unless it gets about about $620 million a year in cost savings, company executives said Monday.

Personnel chief Guenther Flieg said workers at Sindelfingen outside the company's Stuttgart base must bring labor costs in line with those at factories in the north German city of Bremen and in East London, South Africa.

Otherwise, new C-Class model production will be moved to those facilities ``and the alternative would be we will have to part with 6,000 workers,'' most of them at Sindelfingen, Flieg told reporters. Some 41,000 people work at Sindelfingen now.

Mercedes-Benz chief Juergen Hubbert said that ``the Sindelfingen factory is not the most productive plant, by a long ways.''

The company is pressing its German workers to cut paid breaks and extra pay for late shifts and weekends before it will guarantee the company will invest in further production, which is not expected to begin until 2007. Workers have offered to forego a contractual rate of 2.8 percent slated for 2006, which would save 180 million euros ($223 million), but have balked at deeper cuts.

Similar trade-offs of cost concessions in return for guaranteed work are common in the German auto industry and are usually negotiated without great fanfare. This set of negotiations has been more rancorous and worker representatives have called for a nationwide day of protest by DaimlerChrysler workers on Thursday.

Workers at the company's Untertuerkheim in Stuttgart briefly stopped work on Friday to attend an information meeting as part of the protest campaign.

Production of new versions of the C-Class won't begin until 2007 but the investment decisions are being made now.

Hubbert said workers in Bremen in northern Germany had fewer holidays and less burdensome rules on paid break time than their counterparts at Sindelfingen.

``The cost disadvantages are serious,'' he said.

Production at Bremen could be pushed up to 1,200 a day from 700-750, said Hubbert. As many as 300 a day could be produced in East London, which makes versions for countries where the steering wheel is on the right side of the car.