Mercedes-Benz to Retrench 700 Jobs in East London Amid South African Port Crisis

Mercedes-Benz SA (MBSA) is set to cut 700 jobs at its East London assembly plant due to decreased global demand for its C-Class sedan and ongoing issues with South African ports. The company plans to reduce production from three shifts to two. Mercedes-Benz South Africa (MBSA) has announced a significant workforce reduction at its East London assembly plant, with up to 700 jobs on the line. This move comes as a response to a decline in global demand for the C-Class sedan, a staple of the luxury carmaker’s lineup, coupled with the challenges posed by the ongoing South African port crisis.

In a statement released on Thursday, MBSA detailed the initiation of consultations with employees and unions, adhering to section 189(3) of the Labour Relations Act. This consultation process is expected to last up to 60 days and will explore various strategies to mitigate the impact of the layoffs, including options for early retirement, early severance, and natural attrition.

The decision to cut jobs and reduce production from three daily shifts to two, potentially starting in August, highlights the broader economic challenges faced by the automotive industry in South Africa. The port crisis, characterized by inefficiencies and logistical bottlenecks, has exacerbated the difficulties for manufacturers reliant on timely exports and imports.

MBSA’s decision underscores the interconnected nature of global supply chains and the significant impact that local infrastructural issues can have on multinational operations. The company remains committed to engaging with affected employees and unions to find the most equitable solutions during this transition period.