A decision has been made to convene codetermination negotiations with the appropriate trade union organizations regarding the closure and transfer of Trelleborg’s protective products operations from Ystad. This decision has been made to ensure future cost-efficiency for this labor-intensive business, which is exposed to increasing competitiveness and rising raw materials prices.
Various types of protective products, primarily chemical protective and diving suits, are produced in Ystad, where the number of employees totals 89. The evaluation that forms the basis of the decision to convene codetermination negotiations foresees that production will be relocated to the business unit’s plants in Tauragé (Lithuania) and Hull (UK), and that the business unit’s head office will be transferred to the municipality of Trelleborg. Provided negotiations are concluded, production in Ystad is expected to continue until mid-year 2007.
A total of 66 employees will be served notice of termination of employment, of which 10 are administrative and management personnel and 56 are employed in production. This information will be submitted to the County Labor Board today. In cooperation with the trade union representatives, work will commence to support the employees affected and to plan action programs to help them find new employment, both inside and outside the Group.
The costs for closure and restructuring are estimated at approximately SEK 13 M before tax, most of which will affect cash flow mainly in 2007. The positive effect on earnings is expected to total approximately SEK 10 M before tax on a 12-month basis, with full impact as of the third quarter of 2007.