Turns Out Offering Up To $580,000 Is All It Takes To Make Auto Workers Quit

Automakers tend to avoid involuntary layoffs whenever they can. They’re messy, expensive, and never good for morale. Mercedes-Benz appears to have found a workaround, offering substantial compensation to employees who volunteer to leave, and so far, it seems to be paying off.

A recent report indicates that around 4,000 employees have accepted the deal, some receiving as much as €540,000 ($580,000) to leave the company. Despite these hefty individual checks, the long-term math looks good for Mercedes, which could end up saving several billion euros overall.

Who’s Taking the Deal?

Mercedes launched the buyout plan last April and targeted just about everybody in the company. Office staff, IT specialists, engineers, and even mid-level managers have received offers to walk.

As we pointed out in our initial coverage, many of these workers are protected from layoffs through the end of 2034. The only power Mercedes had to get them to leave any sooner was through a program like this.

More: Disgruntled Ex Mercedes Employee Steals Backhoe, Wrecks 50 Vans At Spanish Factory

To that end, the offers had to be so good that workers simply couldn’t refuse. According to a report from Handelsblatt, some workers also received a so-called ‘turbo-bonus’ for making a quick choice to depart the company. Long-serving staff reportedly had six-figure sums on the table in such cases.

For example, a 55-year-old team leader with three decades at the company and a monthly salary of around €9,000 ($9,700), could pocket about half a million euros or nearly $600,000 to bow out early. Even mid-career employees reportedly walked away with €100,000 ($117,000) or more, depending on their pay grade and tenure.

How Many Qualify?

Somewhere between 30,000 and 40,000 employees are eligible for this buyout. The automaker can reject a request, though if it feels that the person in question is in a key role that it doesn’t want to have to refill should they depart. Evidently, only a few requests have been denied at this point.

Also: The Global Sales Battle Between Mercedes And BMW Just Got Embarrassing

The program will run through March 2026, and the company expects more departures as the deadline approaches. Altogether, the effort is part of a much larger cost-cutting plan aimed at saving roughly five billion euros by 2027, as the company faces challenges on multiple fronts, including a 12 percent dip in sales last quarter.

Will a leaner workforce make Mercedes more stable in today’s shifting industry sands? The powers-that-be at Stuttgart certainly hope so. 

Source: Handelsblatt