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Wärtsilä plans to close several European facilities and move production to China to remain competitive. (Photo: Stock File/FIS)
Wärtsilä to slash more jobs
(FINLAND, 1/22/2010)
Wärtsilä plans to reduce its manufacturing capacity to adjust to the fundamental changes in the market. The firm will also move most of its propeller production and auxiliary engine production to China.
The propeller manufacturing in Drunen, and the component manufacturing DTS in Zwolle, both in the Netherlands, are to be closed. The Wärtsilä 20 generating set production in Vaasa Finland is planned to be closed and moved to China to stay competitive.
In 2010, Wärtsilä plans to cut about 1,400 jobs globally, 570 of which will be slashed in the Netherlands. Currently the firm employs 1,561 people in that country.
“By developing our manufacturing footprint and our businesses for the future key markets Wärtsilä will further improve its competitiveness and service to our customers in the tightening markets. It is our responsibility to ensure Wärtsilä’s leading position now and in the future,” says Ole Johansson, company president and CEO.
The non-recurring costs related to restructuring will be around EUR 140 million, including non-cash write-offs of about EUR 50 million, EUR 40 million of which is recognized in 2009.
Wärtsilä seeks cost savings of approximately EUR 80 million to EUR 90 million. The effect of the savings will start to materialise gradually this year and will take full effect in the first half of 2011.
The formal consultation processes will be initiated in the affected countries according to local practices and legislation. The firm will provide support and consultation as well as assistance in re-employment in the impacted countries.
Already last year, Wärtsilä used its flexible operating model to adjust capacity to the new market demand and launched and largely implemented actions to cut approximately 600 jobs. Firm personnel totalled 18,541 at the end of 2009.
Wärtsilä will continue the manufacturing of large 4-stroke engines in Europe: in Vaasa, Finland and Trieste, Italy. In the Netherlands, the firm will establish a Propulsion Technology & Services Centre.
Company net sales grew 14 per cent and profitability before non-recurring items improved compared to 2008. In 2010, net sales will be impacted by the marine market situation and lower order book and are estimated to be 10-20 per cent below 2009.
Profitability before non-recurring items is expected to be 9-10 per cent, at the upper range of Wärtsilä’s long-term profitability target.
It will publish its Financial Statements Bulletin on 28 January.
Helsinki-based Wärtsilä is a manufacturer of large diesel and gas engines for use in powering ships and electricity generation. Its core business is marine diesel engines, but the firm's engines are also widely used in diesel-powered power plants.
By Natalia Real
[email protected]
www.fis.com
Information of the company:
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Address:
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John Stenbergin ranta 2 - P.O. Box 196
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City:
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Helsinki
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State/ZIP:
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(FI-00531)
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Country:
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Finland
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Phone:
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+358 10 709 0000
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Fax:
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+358 10 709 5700
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E-Mail:
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[email protected]
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