Deadline for Nissan buyout is today

SMYRNA — With 23 years on the job at Nissan's assembly plant, Chip McGee thinks it might be a good time to call it quits, now that the automaker is offering a buyout plan that would give him $125,000 to go away.

But on the other hand, at 54 years old, McGee says he's not quite ready to retire, and doesn't know what kind of work he could find that would pay as much as he makes as a maintenance worker in the Smyrna plant.

And then there's the health insurance question.

"That's a big thing," said McGee, a Murfreesboro resident.

"I'm 11 years away from Medicare, so I'd need to have insurance. That's getting harder to find with jobs these days."

Nissan announced July 30 that it would offer buyouts to workers at Smyrna and at its Decherd powertrain plant in an effort to trim 1,200 people from its work force, a move the company said is necessary because of the down auto market.

The deadline for employees to apply is today. Nissan would not say how many workers have applied.

"The response has been good, but the program is still ongoing and we have a lot of information to process," said Nissan manufacturing spokes man Steve Parrett. "We will make everyone aware of the results when it is completed."

McGee said he believes that he and a lot of his co-workers probably will take the buyouts.

"We're just trying to figure out when to go," he said.

"Everybody wants to retire sometime, and I've always had this idea of retiring when I was 55."

With that in mind, he might wait until next year to go, he said.

The Nissan plan offers workers the option of electing to accept a buyout now, but delaying the actual exit until next year or the year after.

VW may be an option

Some of those considering buyouts are looking toward landing a job at the new Volkswagen assembly plant in Chattanooga. Announced in July by the German automaker, that facility is scheduled to open in early 2011.

"It might be nice to get on with Volkswagen," McGee said.

There would be similar pay and benefits, and the former Nissan workers could start over without losing anything, he said.

Nissan said the buyouts would be offered to most of the 5,500 workers in Smyrna and 1,100 in the Decherd plant.

They can elect to take the buyouts right away, or in 2009 or 2010, but with reduced lump-sum payments if they wait.

Workers with less than 15 years of service are eligible for a $100,000 lump-sum payment, and for those with more than 15 years, the payment rises to $125,000.

In addition, health insurance would be continued for one year, and the workers would get a $10,000 allowance toward the purchase of a new Nissan vehicle.

Nissan offered a buyout program last year that included a lump sum of $45,000 plus $500 for each year of service, and about 750 workers took that deal, Nissan said.

Car production at Smyrna will not be affected by the cuts, and will continue to run on two shifts, spokesman Fred Standish said.

Workers from the eliminated truck shift would replace any employees on the car line who chose to take a buyout.

Analysts say the cutbacks are necessary for Nissan to stay competitive under the tough market conditions.

Truck sales have been particularly hard hit, and that's where Nissan is trimming production.

The automaker assembles three trucks in Smyrna: the midsize Pathfinder and compact Xterra SUVs and the midsize Frontier pickup.

Also built there are three cars: the Altima sedan and coupe, and the Maxima sedan.

While the car lines are continuing to operate near capacity on two daily shifts, the truck line was cut back to a single shift on Aug. 11, and is working just four days a week.

Demand won't last

In August, Nissan was the only major automaker to report an increase in sales over last year, up 13.6 percent, with trucks, not cars, providing the boost.

Truck deliveries increased 32.4 percent for the month over August 2007, led by the Frontier, up 55.5 percent, and the Xterra , up 76.9 percent.

But that strong demand for trucks isn't expected to continue, and "trimming the work force is something they just have to do," said automotive expert Erich Merkle with the Crowe Horwath accounting and consulting firm in Grand Rapids, Mich.

"Nissan's product mix has not been the best, and their truck side has just been awful," he said.

"They had a good month last month, but that was because of heavy incentives.

"The Pathfinder has just fallen off the map."

Nissan "took a page out of the Big Three playbook and brought new body-on-frame SUVs to market just as the industry was turning to crossovers," Merkle said.

The Pathfinder and Xterra are body-on-frame models, as is the full-size Nissan Armada and Infiniti QX56 sport utilities, which are built at Nissan's Canton, Miss., plant along with the full-size Titan pickup.

Sales of all of those vehicles have fallen sharply this year.

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