Filed under: Hirings/Firings/Layoffs, Nissan
Nissan offering voluntary buyouts to all Tennessee plant workers
Word has just come across the wire that Nissan will be offering a "voluntary transition program" to all of its hourly employees working in either its Smyrna or Dechard manufacturing plants in Tennessee. These are effectively buyouts, which can net an hourly worker a lump sum of $45,000 and a bonus $500 for each year of service. It's certainly not the sweet deal offered to members of the UAW who work for General Motors and Ford, but the offer could help Nissan reduce the rank and file of its relatively young and non-union work force in North America. For whatever reason, the offer is only being made to employees at these two plants in Tennessee. The Smyrna plant employs about 6,700 people, though some are surely salaried, and produces the Altima, Frontier, Maxima, Xterra and Pathfinder. The Dechard plant only employs 1,400 people and produces many of Nissan's engines, including the glorious VQ 3.5L V6. This news is pretty fresh, so we'll keep our ears peeled for reaction from the auto pundits.
[Source: Jalopnik]
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Reader Comments (Page 1 of 2)
ToyotaLoverUK 11:55AM (2/20/2007)
Another great cost cutting idea from Mr Ghosn. Carry on like this and you 180' turnaround will become 360! We can already see this happening with falling sales and stale cars and technologies at Nissan AND Renault! I admit that Mr Ghosn did a stellar job in returning Nissan to health (though, component sharing with the notoriusly unreliable Renault was a mistake) but he should have handed the reins back to a car guy afterwards. Now Mr Ghosn thinks he can keep cost cutting his way to profitability. Real profits come from new sales. Stop your sales slide and you're half way to fixing the problem (Messers, Wagoner, Mullaly and LaSorda take note! Though, to be fair, I think Mr Mullaly actually has a real world grasp of the problems at Ford)
Am I the only one who thinks Mr Ghosn is one of, if not the, most overrated Auto CEO's today?
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Fred D. 11:59AM (2/20/2007)
Aside from it being a "nice thing to do", can someone remind me why Nissan would *pay* to lay off their workers? :scratches head:
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Hugo 12:07PM (2/20/2007)
I disagree. I don't think Nissan is in a sales slide - it's a mild descent, and new products will probably change it to a mild ascent. Nissan and Infiniti have grown dramatically in recent years, and eye-popping growth numbers will now be harder to achieve (although such growth in volume is probably a lesser goal at the moment than is maintaining industry-leading margins).
Nissan does not widely use Renault components in their cars, at least not those sold in the US. Ghosn did an excellent job trimming their Japanese supplier list.
I don't think Mullaly has an especially good grasp with what's wrong at Ford. Even if he did, I don't see much in the way of progress. GM has done a good job at identifying weak points and has been releasing some very good product lately.
In all, I think Ghosn is a razor-sharp guy and the right one for the job. I wouldn't doubt him right now-his clear view of the industry and willingness to make tough decisions has been stellar, and far beyond what GM, Ford, Chrysler, and Honda have done since the late 90s.
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Richard Warren 12:07PM (2/20/2007)
Uh-Huh
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The other Bob 12:25PM (2/20/2007)
"2. Aside from it being a "nice thing to do", can someone remind me why Nissan would *pay* to lay off their workers? :scratches head:"
My guess: If they just fire some employees, they will open the door to unionization. It's better for Nissan to give them something similar to what the unionized workers get.
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Bryan 12:44PM (2/20/2007)
Nissan was crap before, and Nissan is crap now. They came out with some different designs, fools bought them, and in the end Nissan was still junk, just better looking junk(well to some, I can't find one thats attractive). The Altima has to be the biggest POS. The Titan is a joke. The sentra? Ha! The ancient Focus is still better than that car! From what I have read, Nissan has more factories with lower quality than any other auto manufacturer in the US. I am not seeing people buy the new altima in droves like before. Nissan is back on it's way down. I am guessing Ghosn knows whats about to happen, so he is letting people go early before the disaster hits.
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Lithous 1:26PM (2/20/2007)
Sounds right. If Nissan didn't pay out some money then the rest of the employees would think it best to unionize so they would definitely get serverence pay when it is their turn.
From Toyota's report left on the hard drive, I wonder if there is anything like this in the next 4-5 years coming for Toyota U.S. employees too?
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fizzandpop 1:44PM (2/20/2007)
Shift_to the unemployment line.
Not very good. Has anyone got any better ones?
Oh, oh, here's one:
Shift_income brackets
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bernie 1:57PM (2/20/2007)
Three things are certain in life: Death, taxes and Bryan piling on anytime anything bad can be said about Nissan. I'm guessing he's one of the chronic whiners who didn't want to leave California or he works for a competitor. In either case it's unethical as hell.
Nissan is simply doing what the Big 3 should have done, didn't do, and are paying dearly for now. That is: right sizing your business. When Nissan's model mix improves they'll hire temps and newbies in at the bottom of the payscale and make the kinds of profits that will sustain an automotive company in America in the 21st century. What's top dog Toyota openly concerned about? Wages and benefits being out of line with sales. When Toyota worries about such things you know it's a big issue.
No Bryan, Nissan isn't failing no matter how much you want to throw the first shovel of dirt. They are circling the wagons for what is sure to be a tough year for all manufacturers except Toyota. Then when the skies clear up they'll be in a great position to leap forward.
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PuffyC 2:16PM (2/20/2007)
Severance packages are often times used to separate employees and has nothing to do with Nissan trying to prevent unionization of their workforce. As an interesting side note, if it weren't for the past efforts of the unions there would be no concept of a severance package but that's another story. The reason severance packages are offered usually has to do with reaching a termination agreement. If you agree to be fired then it's a lot easier to reduce your workforce. If you just outright fire people then you expose yourself to lawsuits and bad feelings/low morale among those who remain. It's a tax write-off anyway. You guys should really learn more about unions before assuming all that is evil in this world can be attibuted to them.
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tikirob 2:39PM (2/20/2007)
Maybe they are freeing up there money to buy Chrysler ;)
Rob
http://www.autoshortlist.com
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Rick Lyon 3:23PM (2/20/2007)
You buy them off now and save when they all retire and you have to pay their pensions and all the helath insurance premiums along the way.
Nissan's cars are over priced. If they want to make money they need to be cheaper. The Altima with ABS was almost $25k when I looked a couple of years ago. That for the quality, will simply not do. THe new Centra is cute, but also expensive along with the Versa. They also need to make Infiniti's NOT look like twice expensive Nissans.
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S K 3:33PM (2/20/2007)
There is no doubt that Nissan has lost its way . People blame it on lots of things like moving out from California , Renault so on and so forth. Only thing I would say is that the products don't seem to be up to the mark. The new Sentra is ok ,nothing great. Like wise the Altima is so , so . So like GM and Ford it is a product problem.
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Howard Kerr 3:55PM (2/20/2007)
This is strange. Just a few months ago, or so it's seems, we were reading that Nissan was all but paying folks to re-locate from the West Coast. Yeah, I know, THOSE employees weren't working the "line". But Nissan seems to have many employees it can't please.
Also odd, the plant in Ms. that builds the Titan isn't laying off, even though sales aren't all that great.
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Richard Warren 4:07PM (2/20/2007)
Last good Nissan sedan, wasn't even a Nissan, it was a Datsun 510, last great car 240Z, it's been downhill ever since.
As to Goshn, told ya so. The guy took over at just the right time, now it's time to leave.
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Jim Sanders 5:37PM (2/20/2007)
This is weird.
I thought it was Canton, Mississippi that's been churning out crap cars.
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Jim Sanders 5:40PM (2/20/2007)
Oh I see. Reading the article linked just explained it.
The plant can only produce so many cars at a time.
Altimas cost less labor than trucks to build, so there's less employees needed for the size of the plant.
The plant will still be churning out as many vehicles as it has been, just a larger number of Altimas.
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Jim Sanders 5:41PM (2/20/2007)
This is the result of scientific/engineering advancement.
It costs less labor hours to get the same job done.
As technology advances, less manual labor jobs are needed.
Time to go to a university, and get a white collar job that pays for brain power.
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Jim Sanders 6:38PM (2/20/2007)
Damn Eli Whitney for inventing the cotton gins!
Damn Henry Ford for inventing the assembly line!
Damn the south for using slave labor!
Damn George Devol for inventing the industrial robot!
Damn all those people who contributed to inventing computers!
All jobs should be mine! I want job security picking cotton seeds!
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The other Bob 7:33PM (2/20/2007)
PuffyC:
Actually my comments weren't meant to speak badly of the unions. I think there is a real need for unions, especially in places like Mexico and China.
Puffy, Your ideas may also have some merit, but I think the fact that the transplants often pay just below union scale to avoid unionization may also show the reasoning behind their move to provide severance.
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