Jan. 23--Slumping car sales are forcing a Durham automotive supplier to place about one-third of its 1,100 workers on temporary leave and offer its salaried employees voluntary buyouts.

AW North Carolina, one of Durham's largest manufacturers, furloughed 280 workers effective today without saying how long the leaves will last.

A subsidiary of Japanese conglomerate Aisin AW, the company makes transmissions and transmission parts exclusively for Toyota.

AW expanded rapidly after opening the plant in Treyburn Industrial Park in 2000. But as the economy tanked last year, Toyota's sales declined 4 percent and the carmaker recently closed at least one U.S. plant temporarily to prevent inventory from piling up.

"If they're shutting down, that's going to push down to their suppliers," said Stephen Margolis, an economics professor at N.C. State University.

Executives at AW were not available to comment beyond a statement the company issued.

"We don't know precisely what the production needs will be in coming months," the statement read. "We will continue to evaluate developments in the automotive marketplace as well as our anticipated production needs. No specific timetables to complete this evaluation have been set."

The 280 workers who were furloughed are eligible to receive unemployment insurance benefits. AW will continue to pay their medical benefits.

The company joins a growing list of Triangle employers that have cut jobs or furloughed workers. In December, Caterpillar announced it would temporarily lay off hundreds of workers at factories in Sanford and Clayton.

The number of cars sold worldwide dropped by 3.5 million last year as layoffs, a credit crunch and Wall Street turmoil spurred consumers to put off major purchases.

Foreign carmakers have been navigating the economic crisis better than their U.S. competitors. Toyota claimed the title of world's largest carmaker from General Motors, which reported an 11 percent drop in sales last year. Still, the Japanese carmaker expects to report the first loss in its corporate history for the year ending March 31.

North Carolina is a large supplier of auto parts. About a quarter of the state's manufacturing employment is tied to vehicles.

Unlike other automotive suppliers in the state, AW has so far avoided layoffs. In past months, the company reassigned workers to special projects -- efforts to change processes, boost quality and improve safety -- and temporarily suspended daily production, according to the statement.

Projections of when the economy might pick up vary, Margolis said. A turnaround this year is reasonable but not a sure thing, he said. And as long as car sales are slow, North Carolina's automotive suppliers will feel the effects.

"When the economy goes south, people who would normally buy a car get skittish," said Nate Smith, who runs Durham Technical Community College's automotive technology program. "But folks still have to have transportation."

With business at auto-repair shops steady, Smith said, enrollment in Durham Tech's auto-repair technician classes hit a record high this semester.

sabine.vollmer@newsobserver.com or 919-829-8992

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