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Daimler Trucks is to shut two of its North American truck plants, cease production of the Sterling brand, and transfer some of its output to its new plant in Mexico.

The cuts will mean the loss of 2,300 directly employed production staff, though this figure includes 720 workers whose departure had already been announced. In addition, around 1,200 salaried staff will lose their jobs.

The plants earmarked for closure are the St Thomas factory in Ontario, Canada, where the Sterling medium and heavy-duty trucks are produced, and the Portland plant in Oregon.

St Thomas will close in March 2009 and the Sterling brand will be discontinued from that point, Daimler said. The 720 redundancies already announced there will take effect in November 2008, with other staff leaving when the plant closes.

Portland in Oregon will close in June 2010 and Western Star commercial vehicle production will be transferred from there to the Santiago plant in Mexico, with Freightliner military vehicles going to one of the company's plants in the Carolinas.

Freightliner Cascadia models are already scheduled to be produced at the new Saltillo plant, also in Mexico, from February 2009.

Daimler said the move would improve its earnings before tax by around $900 million by 2011, though the closures would cost it around $600 million before then, largely in severance payments.