Freightliner announces further workforce reductions for St. Thomas plant

PORTLAND, Ore. — About 800 employees will be idled if Freightliner goes through will announced plans to adjust production rates at its truck manufacturing plant in St. Thomas, Ont. These changes are the first in a series of such measures that will affect all the company’s vehicle and component assembly plants during the first quarter of 2007. As many as 4,000 production and related workers may be affected, the company said.

All manufacturers of heavy and medium trucks, as well as the suppliers of components used in their assembly, are facing a dramatic reduction in volumes presently. Truck buyers in all markets are showing hesitation to purchase trucks equipped with the new engine technology necessary to meet the diesel exhaust emissions standards that go into effect in Canada and the US on Jan. 1. Depending on specification and weight class, Freightliner vehicles are subjected to price increases ranging from $4,600 to $12,500, before application of taxes, for the new engines.

“Workforce reductions are always the last thing any of us want to do,” said Chris Patterson, Freightliner president and CEO. “Unfortunately it has become necessary at this point as the entire industry is dealing with an extraordinary market situation.

“We will continue to monitor the market closely and make adjustments accordingly, but we anticipate further reductions of up to 3,200 workers in the first few months of 2007. We are anticipating that demand will begin to recover in the second half of the year, as our customers gain confidence in the new technology, and their existing vehicles suffer the effects of aging. We expect to be able to make some positive workforce adjustments at that time”.

Affected employees in St. Thomas were notified yesterday.