American Axle "Separates" with +500 Workers

Buffalo gear/axle/linkage plant now closed

American Axle & Manufacturing reports that 558 workers at its Buffalo (NY) Gear, Axle & Linkage plant have accepted the separation package it offered last summer, preliminary to the closing of that operation. The plant was idled in December.

In August 2007, about 650 workers represented by the United Autoworkers union were offered a separation package comprised of cash offers scaled to the worker’s employment seniority and retirement eligibility. The company ensured that workers who agreed to retire would retain all vested pension and other post-retirement benefits. The workers who accepted the buy-out retained their vested pension benefits, but forfeited other post-retirement benefits.

Detroit-based American Axle explained last summer that its plan to idle the Buffalo plant was related to its announcement in January 2007, when it said it planned to scale back U.S. production capacity serving the mid-sized light truck market. The Buffalo plant produced drivetrain components for pick-ups and SUVS, mostly for General Motors Corp.

AA&M's expenses for the Buffalo package are estimated at $56 million, less than the original projection of $85 million.

The August offer was the second voluntary retirement /separation package AA&M had presented to workers within 12 months. In October 2006 the company offered packages to workers at six plants in Michigan and New York, which resulted in almost 1,500 separations by January 2007.

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