According to a report by Reuters, Mercedes is seeking to stop production of the C-Class sedan Tuscaloosa, Alabama. In addition, the automaker will also stop manufacturing the A-Class in Aguascalientes, Mexico. Both factories will continue to make more profitable SUVs.
“Our systematic efforts to lower the company’s break-even point by reducing costs and adjusting capacity will need to continue,” said Ola Kaellenius, CEO of Mercedes-Benz, in a statement. Reuters report.
Weak demand for cars during the pandemic is not the only adversity Daimler has faced. It spent 129 million euros ($ 147 million) on buyouts and early retirement, as well as 687 million euros ($ 785 million) to restructure its global production of Mercedes vehicles.
In addition, Daimler also plans to save 2 billion euros per year through staff reductions, which equates to 20,000 jobs, according to Handelsblatt, a German newspaper. The company is also considering selling its Iracemapolis, Brazil plant, while an extension of the Kekskemet, Hungary plant is more likely to encounter a roadblock.