Mexican plant stokes worry
Sterling Truck workers in St. Thomas are worried by plans by Freightliner to build a new truck plant in Mexico.
The company has announced it will break ground this year on a US$300-million assembly plant in Saltillo, Mexico, and begin production in 2009, making the same trucks as those assembled in St. Thomas, Richard Laverty, chairperson of Canadian Auto Workers Local 1001 said yesterday.
"It is never easy to watch your boss invest money somewhere you are not. We would have liked to see that investment in St. Thomas," said Laverty. "Given the magnitude of the Mexico plant, I am nervous."
The union will meet today with Freightliner executives to discuss plant issues and the Mexican facility is at the top of the agenda, added Laverty.
"We will raise in our discussions their commitment to the Mexico development. We will see what they have to say about it," said Laverty. "We want to know what their plans are and what the impact will be here."
Freightliner officials could not be reached for comment yesterday.
The news comes as Freightliner has issued layoff notices to 640 CAW workers at Sterling, bracing for an anticipated slowdown in truck orders this year. Sterling employs about 2,000.
The union will stress the St. Thomas plant is efficient, has high production quality and is close to the market where these trucks are sold, primarily the Great Lakes region, Laverty added.
Freightliner, which is owned by DaimlerChrysler, also has a plant in Santiago, Mexico. Its workers make about US$150 weekly, Laverty said.
The one-million-square-foot Mexican plant will produce about 30,000 trucks a year, including three trucks now made in St. Thomas, and employ about 1,600. It will assemble two medium-duty trucks and one class eight model -- an 18-wheeler.
It will be located near a DaimlerChrysler automotive plant that produces the half-ton and three-quarter-ton Dodge Ram pickup trucks.
"The class six and seven are our bread and butter," said Laverty, adding it is about 30 per cent of the production.
The medium-duty truck is often used by municipalities as garbage trucks, highway departments or for construction and is not as affected by a downturn in the commercial trucking market, Laverty said.
Sterling now has about 11,000 trucks on order. The truck market is expected to slip this year. New truck engine emission standards have driven up the cost of a truck, so many firms bought vehicles last year to save money, meaning demand will drop this year.
Industry officials, however, believe the market will rebound in 2008.
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