Home » The Latest News » Paccar may lay off 800 workers after Nov. 1

Paccar may lay off 800 workers after Nov. 1

Sep 3, 2002 12:00 PM

Heavy-truck maker Paccar Inc. may lay off about 800 employees, or 5 percent of its work force, starting Nov. 1 as tougher federal emission standards for diesel engines result in fewer orders.

The Bellevue, Washington-based company said it notified 500 workers who make Peterbilt trucks in Madison, Tennessee, this week that layoffs are possible. About 268 workers at Paccar's Kenworth plant in Renton, Washington, also may lose their jobs.

Paccar Treasurer Ron Ranheim confirmed the cuts, first reported by the Nashville Tennessean and Seattle Times newspapers, but declined to comment on what percentage the cuts represent at the individual plants. The company had a total of 16,000 employees at the end of 2001.

Several other companies have announced possible layoffs in recent weeks, including truck maker Navistar International Corp. and DaimlerChrysler AG's Detroit Diesel engine unit.

Orders are expected to fall because many of the nation's largest truck fleets ordered vehicles ahead of an Oct. 1 deadline for stricter diesel emission standards.

Most companies have not had a chance to test the new, more expensive engines that meet the standards. As a result, they are worried about fuel efficiency, durability and reliability.

Stark's Truck and Off-Highway Ledger, a Chicago-based business publication, estimated that North American production of Class 8 heavy-duty trucks could fall by 13 percent or more in the fourth quarter from third-quarter levels.

It estimated average daily assembly rates for heavy-duty trucks at 727 units for the fourth quarter. That compares with 868 units a day in the third quarter, 728 in the second quarter and 612 in the first quarter.

Navistar notified workers at its plant in Chatham, Ontario, in early August that it may lay off about 400 workers there if orders drop.

Detroit Diesel has said it may cut up to 700 workers starting in early October at its plant in Redford, Michigan, as it reduces production.

The job cuts at both companies represent roughly half of the employees making heavy-duty trucks.

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