American Axle and Manufacturing on Thursday took a major step toward the shutdown of its Buffalo Gear & Axle plant, which is scheduled to close in late December.
Several dozen workers at the plant on East Delavan Avenue received layoff notices on Thursday, workers said.
Most of the plant's 650 production workers will depart later this month and in December, as production is discontinued, according to a financial planner who works closely with affected workers.
"They'll continue to taper down," said John Lunghino, president of Spectrum Wealth Management in Amherst.
The company's other plants in Cheektowaga and the Town of Tonawanda are not involved in the shutdown.
In a newsletter distributed in the Buffalo plant Thursday, American Axle management praised the work force for maintaining production in the face of the looming shutdown.
It blamed the closing on a drop in orders from customer General Motors, and on other factors outside workers' control.
"The task that we faced this year was not an enviable one," the letter said. "But all of us can walk from here with heads held high, knowing we did our best to grow and sustain this business for 13 years."
American Axle was created in 1994 with the purchase of plants in Western New York and Michigan from GM's Saginaw division.
The Detroit-based axle maker rode a boom in popularity of light trucks, but the Buffalo plant's business took a negative turn in 2006 when GM canceled plans for a replacement rear axle for SUVs, the company newsletter said.
Rising gas prices and changing technology also contributed to the decline in production volume locally, making the plant costly to operate as layoffs mounted and idle capacity grew.
Sister plants in Michigan and one in Mexico can take over the task of manufacturing the remaining products from Buffalo, the company has said. One of the remaining tasks is shipping production equipment to sister plants.
The company had already told union officials that production will be "idled" by Dec. 23. The United Auto Workers union expects the shutdown to be made permanent in February at the expiration of the contract.
Company representatives and union officials were unavailable to comment Friday.
About half of production workers are eligible to retire with a full pension, Lunghino said. Union production workers are eligible for buyouts of up to $100,000, depending on their age and experience. Thursday was the last day for workers to lock in their choice of a buyout or early retirement benefit under a severance program. The severance offer was announced in August.