Numsa slams Mercedes plan to axe more than 700 jobs

The National Union of Metalworkers of SA (Numsa) has slammed the decision by Mercedes-Benz SA (MBSA) to retrench more than 700 employees at its East London car factory.

The German car company announced last week it would reduce production from three daily shifts to two due to declining global demand for its C-Class sedan, which is built at the plant for the local market and export.

MBSA said it had started consultations with employees and unions “in accordance with the Labour Relations Act”. The process, lasting up to 60 days, will include discussions to reduce manpower through early retirement, early severance and natural attrition.

Joint CEO Andreas Brand said the company would also talk to components suppliers about the effect on their business operations and staff. 

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Brand told Business Day previously the carmaker had operated three shifts daily, Monday to Friday, for a decade. The C-Class, which includes hybrid-electric and high-powered AMG variants, was introduced in 2021 after a R13bn investment from Germany.

More than 90% of the East London plant’s output was for export, mainly to Europe, Asia and North America, and the declining demand in these markets was hurting SA. 

“We depend on our export volumes. This is a global issue,” said Brand.

In response, Numsa said it was dismayed by the section 189 notice.

“We are deeply concerned about workers and their families who will be affected if the company goes through with the retrenchments,” said Numsa general secretary Irvin Jim.

“The Eastern Cape, where most MBSA workers are based, will be hardest hit because of high levels of poverty and unemployment. It is unlikely workers will find alternative employment if MBSA implements the proposed retrenchments.”

Numsa said MBSA was contemplating retrenching 702 employees and the job categories that were likely to be affected were artisans (67) and team managers (23) and 612 hourly employees. MBSA employs 3,396 employees in total.

Jim said: “We will wait for the Commission for Conciliation, Mediation and Arbitration to issue dates for the first meeting so we can consult with the employer. Numsa will do everything possible to provide alternatives, with the hope we can prevent job losses.”