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More than 5,000 jobs at Mercedes Car Group

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FRANKFURT, Germany – At least 5,000 jobs are set to be cut at Daimler Chrysler AG's Mercedes Car Group as the new chief executive seeks to turn the struggling group.
Dieter Zetsche, who takes over as DaimlerChrysler CEO on Jan. 1 and has already assumed responsibility for the Mercedes division, is scheduled to meet with the company's supervisory board on Wednesday in Detroit.


Though he has not said what he plans to talk about, officials with DaimlerChrysler, its labor groups and analysts have warned Zetsche may focus on trimming thousands of jobs at the struggling Mercedes Car Group.

A person familiar with the situation, who asked not to be named because it would put his job at risk, told The Associated Press that as many as 5,000 jobs could be affected at Mercedes, the unit that Zetsche headed before the 1998 merger with Chrysler Corp.

A second person familiar with Zetsche's plan, who also requested not to be named because it could threaten his employment, said at least 5,000 cuts would be implemented across the Mercedes group, but not in any other part of DaimlerChrysler.

The division was once the pride of DaimlerChrysler, and industry watchers are keen to see if he can invigorate Mercedes the way he did Chrysler, which posted its eighth straight quarterly operating profit in July.

At the Frankfurt auto show earlier this month, Zetsche was asked if there would be cost-cutting measures or job cuts at the Mercedes business, which includes the struggling Smart compact car unit.

"The whole production process has to be addressed," he said, but would not give details.

Zetsche was named as the next DaimlerChrysler boss after Juergen Schrempp unexpectedly announced July 28 that he would step down at the end of the year. The move relieved investors who felt the Schrempp-engineered merger of Daimler-Benz with Chrysler had failed to bring the promised returns.

Zetsche took over Mercedes after Eckhard Cordes, who helped Schrempp plan the merger and was once considered a leading contender for the top job, stepped down.

Since then, German media have been rife with claims that Zetsche wants to speed up those reforms and is considering cutting jobs to do so.

The Mercedes group has struggled this year, facing a 1.3-million car recall amid quality problems and owner dissatisfaction. The company had already said it was looking at some 1.2 billion euros ($1.4 billion) in restructuring costs this year.

But any job cuts are likely to face intense scrutiny from DaimlerChrysler's labor groups, in part because of a deal signed in 2004 that gives workers job guarantees through 2011.

If DaimlerChrysler does move to cut jobs, it must do so by offering severance payments or early retirement plans that would cause workers to leave voluntarily.

Shares of DaimlerChrysler fell 8 cents to close at $52.83 on the New York Stock Exchange Tuesday.

Source: http://www.signonsandiego.com/news/busines...erchrysler.html

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if mercedes was selling 20,000 dollar cars, you could see why they need to trim expenses, but they sell 80,000 dollar cars and still can't make enough money?


The quality of a Benz has fallen GREATLY in the past couple of decades. A friend of mine has a 1982 Benz Convertible. It's a high quality, solid, well built car. We recently got a 3 year old Benz convertible traded in to the dealership I work at, and the thing was litterly falling apart. Buttons were cracking and coming loose, door panels were starting to seperate from the door, seat leater was starting to wear FAST, and on, and on, and on. I have seen similar exampes too. There is a BIG reason why they are loosing money. I agree though, they should make cash off of 80,000 cars.

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if mercedes was selling 20,000 dollar cars, you could see why they need to trim expenses, but they sell 80,000 dollar cars and still can't make enough money?


They put alot into research/development, and engineering. Though they're quality as fallen, they're still a technological tour de force.

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