Mecachrome to lay off 120 more employees in Canada
Oct. 16, 2008, MOntreal - Mecachrome International plans to cut 120
more jobs in Canada next year as part of its plan to boost profits, the
aircraft and automotive parts manufacturer said Wednesday.
October 16, 2008 By Ross Marowits
Oct. 16, 2008, MOntreal – Mecachrome International plans to cut 120 more jobs in Canada next year as part of its plan to boost profits, the aircraft and automotive parts manufacturer said Wednesday.
The latest cuts, in addition to 41 layoffs announced in July, will cost $3.2 million but save $5.6 million annually, the company said.
“We deeply regret the impact of this announcement on our affected employees, however we need to take strict measures to improve our cashflow profile,'' chairman and CEO Gerard Casella said.
Mecachrome said the layoffs will be implemented throughout 2009 and not affect its ability “to deliver on our client commitment.''
In July, the company said it was shifting some production from France as it tries to adjust to lower demand for its aerospace and Formula 1 products.
It also planned to cut 150 jobs in France by the end of September.
Mecachrome had said it was transferring work on Airbus and Embraer from Amboise, France to Mirabel, north of Montreal, to help fill excess capacity caused by production delays on the Boeing 787.
Operational and financial advisers helped the company review its operations during two phases of restructuring, designed to restore the company to a cash flow break-even position in 2009. The first phase, announced in May, was expected to generate 10 million euros, or nearly $16 million, in annual cost savings.
Mecachrome has been hit by production delays of aircraft such as the Airbus A380, A400M and Boeing 787. Formula 1 racing's freeze in engine development and technical regulatory changes announced in late 2006 are also having an impact, because partners BMW and Toyota have decided to keep their work in-house.
The company operates 11 plants in France, Mississauga, Ont. and Montreal and employs more than 2,000 people.
Mecachrome shares, which are down 98 per cent on the year, gained four cents, or 18.18 per cent, to close at 26 cents Wednesday on the TSX.
THE CANADIAN PRESS