Workforce cuts at Cargotec

16 December 2008

Cargotec will stop production at its Salo facility in Finland and reduce its wider workforce as part of a consolidation scheme.

Some 270 jobs will be cut by reducing permanent and external contracts and not replacing retiring or resigning employees. In addition, temporary employment contracts will not be continued after they expire.

The decision to stop production at its Hiab loader crane factory in Salo is part of a plan to consolidate European manufacturing into three factories.

The remaining functions: product development, sales and marketing, finance and management, after sales and spare parts will be reorganised according to the changed production structure, said the company. Efforts are underway to find alternative uses for the factory with external parties, said the company.

In October Cargotec started restructuring measures as a result of lower demand and profitability, affecting about 700 people. "The measures aim at adjusting capacity in Hiab to the prevailing market situation and improving Hiab and Kalmar's profitability."

Some 300 of those jobe will be cut from locations in Finland: Helsinki, Raisio, Salo and Tampere. The company currently employs 1,700 people in Finland. Global savings are forecast to improve annual results by about €25 million (US$34 million) and asset write downs of about €35 million ($49 million).

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