Componenta Oyi, the Helsinki-based parent of several iron and aluminum foundries and forging operations in Finland, The Netherlands, Sweden, and Turkey, reported it would discontinue operation on one of the production lines of its Pietarsaari Foundry. It said the decision would increase its capacity utilization rate, and relate to a plan announced last month to increase the group’s “competitiveness and profitability.”
The group produces parts supplied to agricultural equipment, automotive, construction equipment, heavy truck, material handling, and wind power equipment manufacturers.
In accord with Finnish labor laws, negotiations with the plant’s personnel representatives are underway concerning a shut down of one of the larger lines at Pietarsaari, and moving the production to other foundries in Finland and Turkey, and to another, smaller production line in the Pietarsaari foundry. The goal of the negotiation is to assess the impact of the changes in terms of the operations and the workers, according to a statement.
About 100 workers will be affected as the production level is reduced at the plant. Current employment there is reported to be 170. The changes would be in effect by September 2013.
“The capacity utilization rate and the profitability of the Componenta Pietarsaari foundry have been poor in the past few years,” according to a statement. It added that future production volume and profitability would be affected by future demand.
The company indicated some unspecified, “unprofitable” product groups would be transferred to foundries in Pori, Finland and Orhangazi, Turkey.
It added that the Pietarsaari foundry would be organized to produce small and medium-volume orders, emphasizing flexibility and high-quality products to customers in the Nordic countries.
Componenta stated that transferring production would improve capacity utilization rates at Pori and Orhangazi too, and would have “an improving impact” on employment at those locations.