American Axle & Manufacturing, Inc. (NYSE: AXL) is going to cut 2,000 jobs in view of some economic difficulties and under the new contract.
A manufacturer of automobile driveline, drivetrain, electronic integrated power units and chassis systems, as well as metal formed products, explained that the majority of cuts would come through buyout and early retirement offers, although there would be some involuntary layoffs.
The company plans to close its forge operations in Detroit and Tonawanda, N.Y., and it will idle parts of two other plants in Detroit and Three Rivers, Mich. It also plans to move some of the business from the plants to lower-cost subsidiaries in Michigan and Ohio, and to operations in Mexico.
This campaign gains power thanks to recently ratified contract following a nearly three-month strike against the auto parts maker.
On February 26, 2008, approximately 3600 American Axle employees went on strike to protest a proposed wage and benefit cut by the company's management. The proposal was to reduce workers' hourly wage from $28 to $14 and cut benefits. Both parts achieved agreement.
The new contract implies the reduction of labor costs between $30 and $45 from $73.48 under the old contract.