Sonoco considering Irish site closure

By Joseph James Whitworth

- Last updated on GMT

The site produces trays such as the one above
The site produces trays such as the one above

Related tags Vice president of the united states Sonoco

Sonoco is considering closing a thermoforming packaging facility in Ireland due to volume and profitability losses over the last few years.

The plant makes thermoformed packages for a range of food processors primarily in Ireland and other parts of Europe.

The firm said it will enter into consultation with the workforce about the potential closure of the Carrickmacross facility in November 2013, with 49 positions in jeopardy.

Sonoco reported that the business had been experiencing a loss of volume and profitability over the past several years and the pattern is continuing through 2013.

They added demand for thermoformed packages are being hit by people cutting back on their orders due to the economic headwinds and replacing it with other forms of packaging.  

Sonoco said they were left with “no viable option” other than to consider closure of the facility but confirmed they are only looking at the one facility and the move is not part of a wider review.

Market conditions and economic headwinds

"Due to shifting market conditions and a financially challenging competitive environment, we have made the difficult decision to consider the shut-down of operations at our Carrickmacross packaging plant,”​ said Jeff DiPasquale, vice president and general manager, Thermoforming, Sonoco Plastics.

“This decision in no way reflects on the performance of our Carrickmacross employees who have always provided high levels of commitment, safety, quality and productivity.”

The site was acquired in 2010, as part of the $120m-deal for Associated Packaging Technologies and produces about 200 million units of dual ovenable CPET trays for ready meals, such as lasagne.

Sonoco said that the ready meals market has been stagnant or declining for several years and has always been a relatively small market for the Irish or UK customer with the European market more relevant on local and fresh products.

"If a shut-down of the facility is the final outcome, we will work diligently to ensure the closing of the Carrickmacross facility goes as smoothly as possible, not only for our employees, but also for our loyal customers, with minimal disruption to the quality and service they have come to expect​," added DiPasquale.

First job reductions in October

In the event the plant does shut down, Sonoco does not expect the first reduction in jobs to occur until October 2013.

After that time, the company's plan would be to gradually scale back operations, targeting a plant closure on 1 November 2013. Until and if that time comes, operations will continue as normal.

"In the eventuality that this closure takes place, we are committed to working with each and every Sonoco employee affected by this decision.

“We would provide eligible employees with competitive severance, outplacement services and support in finding alternate employment​," said Sean Cairns, vice president of Rigid Paper and Plastics operations for Sonoco in Europe.

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