Electrolux will consolidate its Asia-Pacific refrigeration production and close the Electrolux Refrigeration Plant at Orange, Australia, 250 km west of Sydney.
Managing Director of Electrolux Home Products Australia and New Zealand, Dr. John Brown, announced the closing at the Orange plant. He said the plant will close in mid- to late-2016. Until then, it will continue producing large refrigerators and chest freezers, under the Electrolux, Westinghouse, and Kelvinator brands.
Dr. Brown said that Electrolux "appreciated the sensitivity of its decision," noting that the factory has been a major employer since its construction as a small arms munitions factory in 1942.
"But the company's exhaustive investment study, announced earlier this year, concluded that Electrolux is able to manufacture refrigerators currently made here more cost effectively in other factories in Asia and Eastern Europe," Dr. Brown said.
Dr. Brown pointed out that efforts had been made to cost-justify continued manufacturing in orange. Among them: Orange Plant Manager Mark O'Kane encouraged suggestions from employees and led an in-plant team to develop its own productivity improvement plan in an effort to reduce costs and present the best economic case for the plant's continuation.
"We also talked to the relevant people at all levels of government and on both sides of politics, before and after September's federal election," Dr. Brown said.
He added: "And while these talks were very positive and helpful, in the end a compelling business case could not be made for investing the necessary funds to upgrade the Orange plant for the company's future manufacturing needs in the Asia-Pacific region."
Dr. Brown said that a consultative process between management and the workforce would be established and the 544 employees affected by the plant closure would get their full entitlements under existing workplace agreements.
He said manufacturing operations will be wound down "in a gradual and orderly manner," starting in late-2015 and through 2016.
The research and development centre in Orange is expected to continue operating for as long as two years after the plant closes.
Once the Orange plant closes Electrolux will have more than 1,100 employees in Australia and New Zealand. It will continue to operate the Electrolux Cooking Products plant in Dudley Park, Adelaide.
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