Daimler to Drop Sterling Brand, Close Plants in Ontario, Oregon
Daimler Trucks North America said Tuesday it will discontinue its Sterling Trucks brand in March, eliminate 3,500 jobs and close two North American factories in an effort to streamline operations.
Daimler will close its Sterling plant in St. Thomas, Ontario, Canada, in March, when its agreement with the Canadian Auto Workers expires. The plant makes Sterling brand medium- and heavy-duty trucks.
It will also close its Portland, Ore., plant in June 2010, when current labor contracts expire. The moves are expected to improve annual earnings by $900 million by 2011, Daimler said in a statement.
Western Star commercial production will move to Daimler’s plant in Santiago, Mexico, while production of Freightliner-branded military vehicles will take place at one of the company’s manufacturing facilities in the Carolinas by mid-2010.
The moves will eliminate 2,300 workers at the two plants by 2010, including 720 workers at the St. Thomas plant to be laid off next month, as previously announced. The company also plans to reduce its salaried workforce by about 1,200 positions, with over half directly related to the Sterling brand.
Daimler makes Freightliner, Sterling and Western Star truck brands. Ceasing production at the 39 year-old Portland plant will not affect the location or operation of DTNA’s Portland headquarters, the company said.
Sterling models have “substantial overlap with offerings in the Freightliner Trucks product line” and has “only achieved one-fourth of the Freightliner nameplate’s market penetration despite ongoing improvement initiatives and product launches,” Daimler said.
