By Glenn Swain
On the same day Daimler announced it had signed a letter of intent to partner with Motor Coach Industries, the company said it was ending production of its Orion bus. Effective immediately, no new orders will be taken for Orion buses. Daimler said the company would fulfill its current production commitments over the next 12 months.
Daimler said the closing of Orion was due to “low public sector investments by municipal government agencies,” and the company predicted those investments would remain depressed over the next several years.
The operating facility in Mississauga, Ontario, Canada will be closed, and the facility in Oriskany, NY will continue operations related to parts and field service only. In addition, Daimler expects to continue a retrofit program for current customers at the Oriskany facility.
According to the Observer-Dispatch, a Daimler spokesperson said it was too soon to determine how many layoffs would hit the Oriskany plant. The paper reports Orion sold 734 transit buses in North America in 2010, but just 464 in 2011.
The company said it will stand behind all current customer commitments and warranties, and will continue to support all Orion customers’ warranty and service agreements through its extensive network of parts and field service representatives in North America.
“Daimler Buses considered all possible options for reconfiguring our transit bus operations in North America, but at the end of the day, Orion is facing a situation where the cost position is not competitive, the local market is in a continued slump, and growth opportunities are not available from selling the product overseas,” said Hartmut Schick, the head of Daimler Buses. “Discontinuing production of Orion buses was a very difficult decision for us to make, but to secure our leadership position we must always strive to invest resources efficiently in support of our global strategy for growth.”
Daimler said it intends to provide a separation benefit to all eligible employees affected by the reconfiguration of its Setra and Orion bus and coach businesses in North America, including to those separating employees for whom such benefits are not otherwise required by law.