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| Novelis plans closure of UK plant |
| BS Reporter / Mumbai Sep 07, 2010, 01:04 IST |
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Aluminium maker Novelis, an arm of Aditya Birla Group-promoted Hindalco, plans to close down its foil rolling and packaging manufacturing facility in Bridgnorth, UK, by next year.
Activities of this facility, which employs 319 people, will be consolidated and moved to other plants in its European system. The closure is subject to consultation with Novelis employees at the Bridgnorth facility, according to reports.
Novelis is the global leader in aluminum rolled products and beverage can recycling, and the $8.7-billion turnover company operates in 11 countries, with around 11,600 employees. Its parent, Hindalco, is Asia’s largest integrated producer of aluminum and a leading copper producer.
“The proposed consolidation of our foil and packaging businesses at the other plants in the Novelis Europe system would enhance our overall competitiveness and our sustainability as Europe’s leading supplier,” reports said quoting Tadeu Nardocci, president of Novelis Europe and senior vice-president of Novelis Inc.
The proposal to close down the unit aims to improve the competitiveness of Novelis’ overall European foil and packaging production system in response to over capacity in the European foil market. It was primarily to address the European market and structural conditions, not because of any performance issues at Bridgnorth, he said.
A few weeks ago, Novelis had increased the prices of specialty sheet products that it sells to European distribution and industrial customers. The company’s fabrication charge would increase by up to ¤100 per tonne, depending on the product, Novelis had said.
Increasing competition from low-cost countries, poor market conditions and long-term outlook in the segments served by the plant, and high exposure to currency fluctuations are affecting Novelis. Further, the Bridgnorth plant was at a technical and logistical disadvantage compared to other plants in the Novelis Europe system, said the executive.
If, after employee consultation, the proposal was implemented, existing customer orders would be fulfilled and clients would be contacted individually regarding the future handling of their business within the Novelis Europe system, he said.
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