Daimler Truck North America Announces Workforce Reductions
Daimler Truck North America is set to lay off approximately 2,000 employees due to a drop in truck orders and a shift in strategic direction.
On July 11, the company disclosed plans to terminate 573 staff members at its Mount Holly and Gastonia facilities near Charlotte, North Carolina, with layoffs taking effect on September 9, as per a WARN notice from the North Carolina Department of Commerce.
The workforce reductions will impact five locations, including sites in Detroit, Portland, Oregon, Saltillo, Mexico, as well as the two mentioned North Carolina facilities, according to a spokesperson for Daimler Truck North America, who spoke to Equipment Finance News.
“As we navigate a challenging economic environment, we’ve seen a notable slowdown in new truck orders, particularly in our medium-duty, on-highway, and electric vehicle segments.”
— Daimler Truck North America
The spokesperson noted that the company made these difficult decisions to adjust to current market realities and that the impact will vary by location depending on each facility’s operational needs. However, the layoffs will not affect Daimler Truck Financial Services or its planned headquarters move to Charlotte next year.
As of the end of 2024, Daimler employed around 29,200 people in North America, with additional manufacturing sites located in Cleveland, North Carolina; High Point, North Carolina; Gaffney, South Carolina; and Santiago Tianguistenco, Mexico.
Strategic Changes Amidst Market Challenges
The parent company, Daimler Truck, reported a 12.5% decrease in unit sales year-over-year for 2024, which included an 8.4% decline during the first quarter. A preliminary earnings report from July 7 indicated a 4.9% decrease in Q2 unit sales, primarily driven by a 20% slide in North America.
This sales downturn is emblematic of broader industry challenges, evidenced by a 36% year-over-year drop in North American Class 8 orders in June and a staggering 45% decline in May, attributed to tariffs, rising prices for new trucks, and stringent lending standards, according to ACT Research.
Given that low order volumes are likely to persist, Daimler Truck emphasized multiple operational adjustments aimed at enhancing profitability in its “Stronger 2030” strategy report released on July 8:
- Implementing aggressive cost-reduction strategies, including the “Cost Down Europe” initiative aimed at saving 1 billion euros ($1.2 billion) by 2030;
- Expanding its vocational truck division in North America, primarily through the Western Star subsidiary;
- Restructuring Mercedes Benz Trucks to leverage its luxury brand positioning and boost zero-emission vehicle sales in Europe;
- Increasing investment in technology and forming adaptable partnerships to foster innovation for both diesel and zero-emission vehicles.
