Nissan Overwhelmed as TN Workers Accept Buyout Offers

[AZhitman]

Nissan North America Inc. said that 775 workers at its vehicle and engine plants in Tennessee, which equates to around 12 percent of the factories' combined payroll, had accepted a company buyout plan. Initially, Nissan only expected about 300 of the 6,200 factory workers to take the buyouts but the real numbers astounded the automaker.

681 employees in Smyrna and 94 employees at Decherd decided to take advantage of the offers. Retirements accounted for 303 of the combined number. Employees were offered a $45,000 lump-sum payment plus $500 for each year of service to walk away from their jobs. The buyout offers were not made available to employees at other Nissan manufacturing locations in North America.

The automaker is currently in the process of swiftly cutting costs to concentrate more on some production concerns. The cost cutting goal resulted to the relocation of its North American headquarters and 1,300 jobs from Gardena to Nashville in the previous year. The Japanese automaker said it offered the buyouts because of higher demand for passenger cars combined with lower demand for trucks and sport utility vehicles.

This program has resulted in tangible benefits for employees and the company,” said Dan Gaudette, the senior vice president of Nissan North American Manufacturing and Supply Chain Management. “Each person is unique, but several employees have already told us the program will allow them to return to school full-time, to start up businesses they have dreamed about or to start enjoying their retirement. It was the right program at the right time.”

Buyouts have been odd among Japanese car makers with U.S. factories. Nissan said that it wanted to trim the manufacturing payroll in Tennessee because sales of labor-intensive light trucks built there were falling at the same time productivity had increased because of advances in manufacturing technology.

Nissan spokesman Fred Standish said the company does not have plans at this point to hire more employees for the plants. "The total number is good for us," he said. "We can continue producing."

Nissan Chief Executive Carlos Ghosn earlier noted a slump in U.S. sales, especially in sport utility vehicles and pickup trucks. The automaker also expects a decline in sales this year after six strong years of consecutive yearly increases.

The automaker’s Smyrna facility, which is located 25 miles southeast of Nashville, is its principal North American assembly plant. It holds a total of 5,200 employees. The engine plant in Decherd, with 1,000 workers, is about 95 miles southeast of Nashville.

The Smyrna plant manufactures Nissan Altima, Maxima passenger cars, Nissan Frontier pickups and Nissan Xterra and Pathfinder SUVs. The plant is responsible for the assembly of auto parts like the Nissan EGR valve and ensures their quality. The Decherd facility, on the other hand, manufactures engines for Nissan and Infiniti vehicles built in the United States.

[S133P3R]

Being a Nissan geek and so cal native, I had been wondering what happened to the Nissan building off the fwy, now I wonder if it was also subject to a payroll buyout. Do the employees work on a contract at the plants?
Good article, not the best news but worse things could have happened to the employees.

[nissangirl74]

Nissan said that it wanted to trim the manufacturing payroll in Tennessee because sales of labor-intensive light trucks built there were falling

This explains it all. They are building trucks that can not compete in a market where fuel economy matters. The F-150, Silverado, Ram, and Tundra ALL get better highway fuel economy than the Frontier or the Titan. The Ford does 'as well' in town.

Not knocking either truck. They are very capable. I'll never get rid of our Frontier. However, I will drive it a lot less now that the price of gas has gone up so much. I wouldn't buy a new one, either.

[C-Kwik]

I had been wondering what happened to the Nissan building off the fwy.

Tireco bought the main building and now has a huge sign up in place of where it used to say Nissan. You can see it if you zoom into bird-eye view on google maps. Its still weird passing by on the freeway and seeing that.

http://articles.latimes.com/2010/mar/03 ... -2010mar04

[Bubba1]

That's a nice sounding buyout figure but there are two large items not mentioned. One is health benefits, which I'm sure will get discontinued since its a buyout. The other is taxes, which will take a significant chunk out that windfall, likely be paid in one lump sum. It could be a decent deal for someone with well over 20 yrs in, with a working spouse who can add them to their benefits plan.

[Jesda]

I hope they've accounted for the labor necessary to build 4-cylinder engines for Mercedes-Benz, especially if it becomes a popular option?

[PapaSmurf2k3]

Weird. Sales of the frontier have actually INCREASED since Ford stopped making the Ranger.

Smyrna will be producing the Leaf, and Canton is getting the Frontier/Xterra. Not sure what's going on with the new Pathfinder, but I would guess its staying in Smyrna...
Doesn't mention how many people Canton will be hiring for the switch. It might have something to do with swapping Nissan labor for contract labor as well...

[AZhitman]

That's a nice sounding buyout figure but there are two large items not mentioned. One is health benefits, which I'm sure will get discontinued since its a buyout. The other is taxes, which will take a significant chunk out that windfall, likely be paid in one lump sum. It could be a decent deal for someone with well over 20 yrs in, with a working spouse who can add them to their benefits plan.

...however, here's a thought: For someone who was in Gardena, and owned their home for some time, and then moved to Nashville, they *probably* left CA with a crap-ton of equity (since that move happened at the peak of the housing market) and bought a house in TN for cash. Fast-forward several years, they're in a good position (especially if their spouse is working) to take the money and run.

I can't see many other scenarios where taking a one-year salary figure to walk away makes ANY sense... My guess is, the ones who left are either former Gardena-ites with a fat rack of mutuals, OR older employees who were just working because they're bored at home.

[S133P3R]

...however, here's a thought: For someone who was in Gardena, and owned their home for some time, and then moved to Nashville, they *probably* left CA with a crap-ton of equity (since that move happened at the peak of the housing market) and bought a house in TN for cash. Fast-forward several years, they're in a good position (especially if their spouse is working) to take the money and run.
I can't see many other scenarios where taking a one-year salary figure to walk away makes ANY sense... My guess is, the ones who left are either former Gardena-ites with a fat rack of mutuals, OR older employees who were just working because they're bored at home.

very insightful. thanks AZhitman.