Cat , Detroit Diesel, Navistar- Laying Off Workers

PEORIA, Ill., Sept 6 Reuters reports that Caterpillar Inc. said Friday it will lay off about 470 full-time hourly workers during the fourth quarter as strict new federal emissions standards result in fewer orders for heavy-duty truck engines.

The world's largest maker of construction equipment also said it will also cut 290 temporary workers who were hired to meet a surge of orders ahead of the Oct. 1 emissions deadline.

A total of 3,000 Caterpillar workers make diesel engines at its various facilities, the company said. The temporary layoffs will be made in Mossville and Pontiac, Illinois after Oct. 4.

Similar job cuts have been announced by several other manufacturers in recent weeks.

DaimlerChrysler AG's Detroit Diesel engine unit may cut up to 700 workers at its Redford, Michigan plant. Truck maker Navistar International Corp.has said it may cut 400 Canadian workers. And PACCAR Inc.<PCAR.O> has notified almost 800 employees that layoffs are possible.

Orders for diesel engines and heavy-duty trucks have risen sharply this year as truckers rushed to get existing engines rather than wait for the new models.

Many fleet owners complain they haven't had enough time to test engines that meet the stricter clean-air standards. They are worried that the engines, in addition to costing more, will prove to be less fuel efficient and less durable than current models.

It's unclear how much orders will fall, especially given the weaker-than-expected U.S. economic recovery. Caterpillar, based in Peoria, Illinois, said it will continue to keep an eye on the situation.

"Additional employment decisions will be based on customers demand for truck engines in the fourth quarter," it said in a release.

The company added that retirements expected in the fourth quarter will offset the need for some layoffs and some idled workers may be transferred to other business units.

Only two companies connected to the heavy-duty truck industry haven't announced layoffs -- diesel engine maker Cummins Inc. and DaimlerChrysler's Freightliner, the No. 1 heavy-duty truck maker.

Cummins was the first company to have an engine certified by the U.S. Environmental Protection Agency as meeting the new emissions standards. It has since had another model approved as well.

Caterpillar will have an engine available this fall that has lower emissions than its existing models although not low enough to comply with the standards.

The engine, however, is based on its existing technology. Caterpillar has said it will pay any EPA penalties that are assessed and not pass the cost along to customers.

Caterpillar plans to have an engine based in its new ACERT technology that does comply with the new standards ready by early January or February.