Chrysler’s Belvidere workers mulling buyout offers
Chrysler LLC is offering workers at its Belvidere assembly plant two separate buyout packages as it plans to eliminate its third shift there Feb. 25.
The plant is the Rock River Valley’s largest manufacturing employer with nearly 3,600 salaried and United Auto Workers employees. But Chrysler plans to lay off nearly 1,100 of those workers. Sales of the vehicles made there, Dodge Caliber, Jeep Compass and Jeep Patriot — though strong worldwide compared to past Belvidere products — were not strong enough to support three shifts of workers.
The qualifications vary for each buyout offer, but many workers age 55 and above will qualify for an early retirement offer of a $70,000 lump sum payment and their accrued pension benefits, Chrysler corporate spokeswoman Michelle Tinson verified by e-mail on Thursday. The other offer is for permanent workers who have at least one year of seniority, Tinson verified. They can take a $100,000 lump sum payment with six months of medical insurance — excluding dental — as a voluntary termination.
Workers began receiving the buyout offers Tuesday and have until Jan. 24 to decide. The company wouldn’t disclose how many were offered buyouts. It would say the Belvidere plant has 352 workers who have 30 years or more of experience. The company offered buyouts to workers at a plant in Detroit last week and is expected to offer them at plants in Toledo, Ohio; Sterling Heights, Mich.; and Ontario, Canada, as well. All are facing layoffs.
Dale Weaver of Machesney Park said many workers are weighing their options. Weaver, a salaried worker in production control, transferred to the Belvidere plant in 2005 from Alabama and has 24 years of service. He said he is not eligible for the early retirement offer and isn’t in a position to accept a voluntary termination offer.
“With all things considered, I feel the offer is more than fair,” Weaver said. “Given the uncertainty of the automotive future and with Chrysler now being privately owned, had I been offered a retirement package — even without the $70,000 incentive — I would have taken it in a heartbeat.”
At the beginning of 2006, the plant had just 1,600 active workers but Chrysler added two shifts and 2,000 workers by the end of that year as the company launched three new vehicles — the Dodge Caliber, the Jeep Compass and the Jeep Patriot.
To fill out the three shifts, Chrysler enticed more than 900 workers from operations in Huntsville, Ala.; Indianapolis; and Syracuse, N.Y., to transfer to Belvidere. It also hired 800 workers on temporary two-year contracts that featured lower pay and fewer benefits and protections than permanent employees, and gave the company the ability to end the contracts at any time.
In 2007, dealers worldwide sold nearly 295,000 Calibers, Compasses and Patriots, the highest total for Belvidere-made products in at least 10 years. Still, dealers couldn’t sell the cars as quickly as three shifts of workers could turn them out. The plant produced 333,000 vehicles, just missing breaking a 21-year-old production record, and in November the company announced it would convert the plant back to two shifts and cut 1,100 workers.
About 600 of the temporary workers remain on the payroll and will be the first laid off unless a large portion of the workers take the buyouts. As temporary workers, none are eligible for buyouts even though most have worked there for two years.
In 2001, when former Chrysler owner, Daimler AG of Germany, eliminated a shift at Belvidere about 600 Belvidere workers accepted buyouts rather than be laid off. And in 2006, about 850 workers at General Motors’ assembly plant in Janesville, Wis., accepted buyout offers as GM cut the plant’s payroll from more than 3,600 to around 2,800.
Steven Franklin is a two-year temporary worker who is hopeful, though not overly confident, that enough workers will take the buyouts to open up jobs for at least a few temporary workers.
“I know a lot of people who have been here 10 years saying they’ll take it if it’s offered. One guy told me he will take the money because he wants to start his own business,” Franklin said. “But here’s the deal, a lot of people talk big, but when it comes to crunch time will they really do it?”
Assistant Business Editor Alex Gary may be reached at firstname.lastname@example.org or at 815-987-1339.