Job cuts at Mercedes-Benz due to port crisis, economic conditions
Mercedes-Benz South Africa plans to cut 700 jobs, about a quarter of its workforce, at the East London manufacturing plant in the Eastern Cape due to the port crisis.
The carmaker, which produces C-Class sedans for global export, attributes the decision to deteriorating economic conditions, logistical hurdles, and weakened consumer sentiment.
“In recent years, the automotive industry has contended with several challenges which have also impacted MBSA and its suppliers. These challenges include deteriorating macroeconomic conditions and prolonged port challenges.
“Overall consumer sentiment has suffered as a result of fluctuations in the exchange rate, subdued household income, rising fuel prices as well as increased energy and logistics costs,” the company said in a statement.
The company has initiated consultations to restructure operations and may reduce shifts from three to two.
This, could lead to some 700 job losses.
“We have implemented various measures to address and improve the performance of our manufacturing operations, including cost-saving initiatives and efficiency improvements,” it said.
“However, despite our best efforts, the current operating environment remains challenging, necessitating further action to ensure the long-term sustainability of our manufacturing operations.”
