Thursday, 28th June 2012, Velenje / Slovenia, Vara/ Sweden
Gorenje continues restructuring Asko in Sweden
Gorenje Group completed the first phase of negotiations with the representative trade unions of its Swedish subsidiary Asko on various possibilities of optimizing and restructuring this company. The results of the studies show that from the economic aspect, shifting the entire production of washing machines, tumble dryers, and dishwashers from Asko plant in Vara to Gorenje facilities in Slovenia would be the optimum solution. The entire R&D department would remain at Asko facilities in Vara, as well as Asko brand management and marketing departments. In the days ahead, the Asko Board of Directors will reach the decision on the optimum solution.
Swedish company Asko has seen negative results, falling short of the plans despite the numerous projects aimed at improving the performance, launched immediately after the merger with the Gorenje Group. In addition, the conditions in the home appliance industry have grown harsher as the economic crisis continued to loom large. Competition by manufacturers from low-cost countries and major players who have expanded their manufacturing operations in low-cost countries in recent years is growing stronger, making it ever more difficult to win and retain market shares. In addition, the pressure on sales prices is mounting due to excess capacities, high cost of raw and processed materials, and other market conditions. Pursuing the strategic plan laid down for the period 2012 – 2015, Gorenje Group is conducting various measures to improve profitability and competitiveness. These measures include intensive optimization of all manufacturing operations.
Thus, Gorenje Group commenced this April negotiations with the representative trade unions at the Swedish subsidiary Asko, regarding the possibilities of optimizing and restructuring the company. Studies were developed for four different variants. In economic terms, the solution found to be optimal was to shift the washing machine, tumble dryer and dishwasher production to Velenje, while keeping the entire R&D department, as well as Asko brand management and marketing departments in Vara. This would allow approximately 50 of the approximately 500 employees with permanent employment contract to keep their jobs in Vara.
The shift would take place next year, presumably in two steps. Production of washing machines and tumble dryers would be terminated in Sweden on January 31, 2013, and resumed in Velenje in April of the same year, and dishwasher production would be stopped in Sweden on June 30, 2013, and resumed in Velenje in September 2013. Final decision in this regard will be adopted by the Asko Board in the coming days.
Gorenje Group acquired the Swedish company Asko in the summer of 2010. Manufacturing operations in Vara represent approximately 7 % of Gorenje Group's overall production output.
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