Hagerstown Mack plant to cut production, jobs

December 12, 2008|By Andrea K. Walker | Andrea K. Walker,andrea.walker@baltsun.com

Volvo AB of Sweden said yesterday that it is cutting production and workers at its Mack Powertrain Division plant in Hagerstown to reduce costs because sales of its trucks and buses have dropped.

The Hagerstown plant will reduce production of its transmissions by a third and of its engines by 25 percent, said Ilse Ghysens, a plant spokesman. The changes are effective Jan. 25. The cuts were first reported by the Herald-Mail in Hagerstown.

"There is a lower demand due to the economic downturn, and we have to adjust," Ghysens said.

The company did not know how many workers would lose their jobs because it was still negotiating details with the United Autoworkers of America Local 171.

"We knew cuts were coming," said Dave Perkins, president of Local 171. "We anticipated it, knowing the economy is down throughout the world."

The Hagerstown plant employs about 1,260 workers building heavy engines and transmissions for Mack and Volvo heavy-duty trucks and Prevost buses.

Perkins said the plant has laid off 157 employees in the past two years, including 65 in November.

State and Washington County officials said they don't expect the layoffs to jeopardize any government incentives Volvo has received. The company has to maintain 1,000 jobs to keep the incentives, a level it expects to keep, said Tim Troxell, executive director of the Hagerstown/Washington County Economic Development Commission.

"Based on the national and global economy, it's not a huge surprise that Volvo is experiencing some difficulty here locally," Troxell said.

"Hopefully, the decision they're making right now will allow them to get through this tough period and come out ... a stronger company and be able to rehire those people when the market picks up."

Karen Glenn Hood, a spokesman for the Maryland Department of Business and Economic Development, said the agency will get employment numbers from the plant by Dec. 31, but she doubted there would be a problem:

"For as long as we've been working with the company, they have far exceeded the levels we've created. This is a function of the economy. They've always been a wonderful employer in Maryland."

Ghysens said, "As soon as our customers go up, we go up. ... Hopefully, that will be sooner than later."

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