Electrolux May Relocate Vacuum Factory to Land Fighter Jet Contract Apr 1, 2004

Printable format  Email this Article  Search

If Swedish white goods producer Electrolux decides to move a vacuum cleaner factory from Sweden to Hungary, it could help Sweden land a massive fighter jet contract, Swedish media reported.

Electrolux said in February 2004 that it was considering closing its vacuum cleaner factory in the southeastern town of Vaestervik, Hungary, where it is the largest private employer, in an attempt to save money on lower salaries in the eastern European country.

According to a report in Swedish daily Dagens Nyheter, the plan to move more than 500 jobs to Hungary is part of a larger strategy to convince that country to purchase the 14 Jas 39 Gripen fighter jets it is currently leasing from Sweden.

"The fact that Electrolux made this decision (to move from Vaestervik to Hungary) will be counted in (the Jas deal)," Electrolux CEO Hans Straberg said.

In 1995, Electrolux and some 40 other Swedish companies said they would participate in so-called "offset" deals, in which the business they do in potential Gripen buyer countries counts in favor of a contract for the Swedish fighters.

"Anything we produce in Hungary is counted in, so it would be strange if moving our factory there, if we decide to do so, doesn't count as well," Electrolux spokesman Jacob Broberg said.

He insisted however that a possible Swedish fighter jet deal would have nothing to do with Electrolux's final decision on whether or not to move its factory.

"Any decision we make is made for our own business reasons. We don't get anything out of a Jas Gripen deal, so that's not why we would do this," Mr. Broberg said. (AFP)

Back to Daily News