Cummins will cut 125 jobs

[Keith Browning]

Quote:

From The IndyStar.com

June 3, 2008


Cummins will cut 125 jobs

Drop in sales of diesel pickups hurts Walesboro plant, as it has Navistar

By Ted Evanoff
ted.evanoff@indystar.com

Falling sales of diesel pickup trucks have claimed more jobs at the Cummins diesel plant in Walesboro.

Columbus-based Cummins will cut 125 positions in the plant next week, a decision that follows Navistar's temporary shutdown last month of its Indianapolis diesel line, idling 500 workers through the week of July 14.

Cummins Walesboro is the sole source of diesels for the Dodge Ram pickup truck, while Navistar's International Truck & Engine plant in Indianapolis supplies all diesels for Ford's F-series pickups. The Walesboro plant employed about 1,000 workers a year ago. Since then, about 100 temporary workers were let go.

Sales of diesel pickups have sagged as the building industry hit hard times and diesel prices at the pump soared.

In Indiana, both diesel makers have described the layoffs of the permanent work force as temporary. Navistar expects diesel orders will rise once overstocked Ford dealers sell off unsold trucks. Beginning in August, Chrysler will make the restyled 2009 Dodge Ram, and diesel orders are expected to rise at that time, Cummins spokesman Mark Land said.

Cummins is trying to find positions in its other plants, including the fuel systems plant in Columbus, for workers displaced from Walesboro, Land said. It is also asking for volunteers in the Walesboro plant willing to take time off. It is not clear when the temps will be recalled.

Cummins layoffs, which would begin next week, come as pickup truck sales ebb from the huge volumes of recent years. Dodge, for example, has sold about 93,000 diesel and gas Rams this year through May, down 24.2 percent from the same period a year earlier. F-series sales have slipped 15.5 percent, while Chevrolet Silverado sales have declined 20.8 percent.

Diesel trucks, which account for about a third of the pickup market, have been particularly hard hit as fuel prices rise.

In the Indianapolis area, diesel averaged $4.84 a gallon Monday, AAA reports, 89 cents more than the average price of unleaded regular gasoline.

Diesel costs more in large measure because oil refineries in the United States and abroad are near full production capacity and can't keep up with diesel demand, and the new grade of low-sulfur diesel fuel introduced last year in the United States costs more to make.

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