Dismay As Mercedes-Benz Announces Shedding of 700 Jobs at East London Plant: “This Is Bad”

Dismay As Mercedes-Benz Announces Shedding of 700 Jobs at East London Plant: “This Is Bad”

  • Mercedes-Benz South Africa (MBSA) has announced engaging in a retrenchment process to affect 700 employees at its East London manufacturing facility
  • MBSA said the move was due to several factors, including unfavourable macroeconomic conditions, informing the move from a three-shift to a two-shift model
  • The company said the move was necessary to ensure long-term sustainability amid ongoing challenges in the automotive industry
  • Social media was abuzz with news of the looming retrenchments, with many netizens expressing their dismay
Mercedes-Benz South Africa to engage shed 700 jobs
Mercedes-Benz South Africa is entering Section 189 consultations as it prepares to retrench 700 workers at its East London manufacturing plant. Image: Alexander Koerner
Source: Getty Images

EAST LONDON — Mercedes-Benz South Africa (MBSA) is poised to lay off about 700 workers in East London, Eastern Cape, to improve the operational performance of its Gately plant.

The company announced that it is entering a Section 189 consultation process under the Labour Relations Act to discuss restructuring its manufacturing operations.

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World-class manufacturing facility

The East London facility is central to the C-Class global production network, exporting sedan vehicles to right- and left-hand-drive markets.

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

In a statement, Merdedes-Benz said it was planning to move from a three-shift to a two-shift model amid ongoing challenges in the automotive industry.

According to a SABC News report, tough macroeconomic conditions, volatile exchange rates, increasing production costs, and prolonged port challenges were among the challenges.

Efforts not reaping desired results

Despite efforts to improve efficiency and cut costs, the company said it needed to take decisive steps to ensure long-term sustainability.

Mercedes-Benz has since committed to fostering cooperation with relevant stakeholders as it embarks on the Section 189 process.

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Early retirement, voluntary severance and natural attrition measures could result in more employees being retrenched.

Looming retrenchments worrisome situation

Netizens had their say about Mercedes-Benz's announcement, which sparked a frenzy online.

Briefly News scanned the comments to find some of the alarming responses to the news.

@U_Siphoz said:

"Well, that's what you get when your base entry-level car is R800k."

@KahlaSibusiso shared:

"This is bad news, especially for East London, because a lot of people there work at Mercedes."

@NondabaNyuswa offered:

"The mud from the rain they prayed for. Requiring a salary of R75 000 for your cheapest car in a country like ours."

@Makhetha57060 shared:

"More Section 189(3) of LRA. It's up to the new government to [develop] strategies to revive the economy.

@TheOneEL mentioned:

"Their cars are completely unaffordable in SA."

South African Post Office pushes ahead with retrenchments

In related news, Briefly News previously reported that the South African Post Office (SAPO) had announced retrenching nearly 4,900 employees.

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Netizens are not ready to let go of the green book ID

Despite hopes for relief through the Temporary Employee/Employer Relief Scheme (TERS), the Joint Business Rescue Practitioners of the South African Post Office could not secure the necessary funding.

Source: Briefly News

Tshepiso Mametela avatar

Tshepiso Mametela Tshepiso Mametela is a seasoned journalist with eight years of experience writing for online and print publications. He is an evening/weekend editor at Briefly News. He was a general news reporter for The Herald, a senior sports contributor at Opera News SA, and a reporter for Caxton Local Media’s Bedfordview and Edenvale News and Joburg East Express community titles. He has attended media workshops, including the crime and court reporting one by the Wits Justice Project and Wits Centre for Journalism in 2024. He was a member of the Forum of Community Journalists (FCJ) from 2018 to 2020.