Workers at Caterpillar's Tullamarine truck body plant will be affected by the lay-offs announced by the US parent company overnight, according to a union representative.
The farm and industry machine maker plans to shut down the night shift at the facility which makes equipment primarily for the mining industry, according to Australian Manufacturing Workers Union metal's division official Tony Mav. About 30 workers are employed in the company's night shift.
"The news doesn't look good,'' said Mr Mav. "Hopefully Caterpillar can keep their head above water.''
The company announced 20,000 lay-offs, of which 15,000 had already occurred worldwide, while reporting an annualised quarterly profit drop of nearly one-third.
Caterpillar's earnings tumbled to US$661 million in the fourth quarter from US$975 million a year ago, a 32% plunge.
Locally, Caterpillar has sent a flyer to about 20 managers seeking their interest in taking redundancy packages, Mr Mav said.
Caterpillar refused to be drawn on the specifics job losses for each location.
"Generally we are not breaking out the specifics on a location by location basis,'' said Caterpillar chief corporate spokesman Jim Dugan via email.
"But it is fair to say that just about every one of the Caterpillar locations around the world will see some impact, and this includes our operations in Australia.''
Mr Mav said 40-50 contract workers had already left the Tullamarine factory in December.
Factory fall-out
Manufacturing companies have seen demand drop off as the economy slows, exacerbated by the financial crisis.In Australia, the plunge in commodities prices as well as demand for iron ore and coal has forced companies to put mining projects put on hold or scrap them completely.
The slowdown has stalled new orders for the truck bodies and front-end loaders built in Australia.
Mr Mav said he hoped the Australian government makes manufacturing jobs a higher priority in the future.
"The disappointing thing about this is that the government is saying unions should be easing on the wages (issue) and putting in some job security and I ask the government: What are they doing about job security for Australians?''
The AMWU represents about 120 Metal workers at the Tullamarine facility which employs roughly 600 people.
In a statement from the company, Caterpillar raised the possibility of further retrenchments in the year ahead.
"Depending on business conditions more layoffs may be required as the year unfolds,'' Caterpillar said.
In addition to job cuts, the machinery maker is paring back capacity around the world.
"Several facilities have shortened workweeks, and thousands of employees have been, or will be, affected by temporary layoffs and full and partial plant shutdowns,'' the company said.
czappone@fairfax.com.au
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