Mercedes-Benz to lay off 3,600 workers in Brazil

On Tuesday, September 6, Mercedes-Benz said it would lay off 3,600 employees in restructuring its truck and bus chassis plant in the Brazilian state of São Paulo amid pressure on its production.

The company said it plans to outsource elements of its operations in the Brazilian city of São Bernardo to cope with cost pressures and changing auto industry.

Mercedes-Benz said it would outsource production of front axles and medium-sized transmissions, as well as logistics and maintenance services, giving priority to local companies.

Meanwhile, it will focus instead on its “core business,” which includes the production of chassis for buses and trucks, the company said in a statement.

Mercedes-Benz will lay off 2,200 workers at the Sao Bernardo plant, while another 1,400 employees will not have their temporary contracts renewed as of December.

The main union of the company’s workers, Sindicato dos Metalurgicos do Grande ABC, said its leaders met with the Mercedes-Benz board of directors on Tuesday afternoon, and that company representatives requested the start of negotiations on the decision.

The union board will hold an assembly with the workers on Thursday.

With information from Reuters