Troubled tabletop group Waterford Wedgwood is to cut production at its Irish Waterford Crystal factory in Kilbarry, Waterford with the loss of 490 jobs – and has warned that many more redundancies are to follow group-wide.
The company says it will now outsource the uncompetitive part of its manufacturing capacity at Waterford, along with some administrative operations.
Waterford Crystal chief executive officer John Foley said: “Manufacturing in Kilbarry, at the present scale, has become untenable due to a combination of high costs and unfavourable currency movements which have reduced our competitiveness by tens of millions of Euro in the past five years. The only way to secure the future of the operations in Waterford is to close the parts which are uncompetitive and to outsource these activities to lower-cost environments which can meet the quality standards of the Waterford brand.
“We intend to cease production of several lines that are loss-making and focus the factory on the production of high-quality, cost-competitive products which will result in the retention of 510 jobs in Ireland. While I regret the loss of 490 jobs, it is imperative that we continue to focus on our remaining cost-competitive capabilities to secure the future of manufacturing in Ireland while continuing to monitor the value of the dollar.”
Along with Waterford Crystal and Wedgwood, Waterford Wedgwood owns two more of the tabletop sector’s most prestigious brands: Royal Doulton and Rosenthal. However, the group has suffered severe trading difficulties this year. In the six months to September 30 it reported increased pre-tax losses of £40m and a sales slump of 10% to £220m. The company attributed the poor figures to product shortages and a weak dollar.
At Wedgwood, based in Barlaston, Stoke-on-Trent, sales were down 8.5%.
In addition to the job losses at Waterford, the parent company has warned that it looking to achieve further significant cost-cutting across the group, in manufacturing, administration, warehousing, distribution and other operations in high-cost countries, with the consequent loss of 1,400 jobs.
Waterford Wedgwood this week announced the appointment of a new chief financial officer, Anthony Jones. He said he was looking forward to “completing the urgent task of restructuring the cost base and returning the group to profitability”.