700 workers at Mercedes plant in East London face retrenchment

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Mercedes Benz South Africa (MBSA) plans to retrench 700 workers at its East London manufacturing plant as the company tries to improve operational performance. In a statement, the company announced it is entering a consultation process to discuss restructuring its manufacturing operations.

It is planning to move from a three-shift to a two-shift model.

MBSA says this decision comes amid ongoing challenges in the automotive industry.

These include poor macroeconomic conditions, prolonged port challenges, volatile exchange rate and rising costs.

The company says despite efforts to improve efficiency and cut costs; further action is still necessary to ensure long-term sustainability.

MBSA has committed to a close collaboration with relevant stakeholders as it embarks on the Section 189 process focused on the restructuring of its manufacturing operations.

It says the move could see the number of employees retrenched through the implementation of early retirement, voluntary severance, and natural attrition measures.

The MBSA East London plant is a key part of the global production network for the C-Class.

It produces sedan cars for both right- and left-hand drive markets for export.

The current C-Class, the sixth generation, has been in production since 2021.

-Report by Nosipho Radebe