Slump in demand leads car parts firm to axe 300
THREE hundred people are to lose their jobs at one of the country's leading car components manufacturers.
German-owned Kostal yesterday confirmed to their 1,100 workers in Abbeyfeale, Co Limerick and Mallow, Co Cork, that it is seeking 300 redundancies.
Kostal said it remains committed to the future of its Irish operation, but admitted that "the reductions are in line with the drop in customer demand which the company expects in 2009".
It came on a day when 800 job losses were announced across the country and raised fears that dole queues could soon reach record levels.
Outside of Dell, which is to lay off 1,900 staff, Kostal is the largest employer in Limerick, with 650 employed from across the area, including north Kerry. Most of the jobs (200) will go at the Abbeyfeale plant, while another 100 will be made redundant in Mallow, where 450 are employed.
Kostal has informed workers that until the reduction in staff numbers is completed, they will continue to manage the over capacity through short-time work. It hopes the cutbacks will come from voluntary redundancies by March. Details of redundancy packages will be made known to workers in coming weeks.
Management hope the 300 job losses will allow Kostal to "continue to operate competitively in Ireland".
The firm set up in Ireland in 1981. Managing director Michael Genster said they regretted having to make the decision, which would not affect a €19m planned investment in their Irish interests this year.
Fine Gael enterprise spokesman Leo Varadkar said the country was in a "winter of discontent", with 700 people losing their jobs yesterday.
"These job losses should bring home the sheer scale of the crisis to Tanaiste, Mary Coughlan," Mr Varadkar said.
"We have waited long enough for the Government to take action. To date, she has refused to acknowledge that unemployment is spiralling out of control, let alone respond."
Fine Gael TD for West Limerick, Dan Neville, said it was a black day for the area.
"The cost of doing business in Ireland has risen dramatically in recent times," Mr Neville said.
"Over the past months I have consistently warned the Government that, apart from the national economic crisis, we have a crisis of confidence in the midwest region due mainly to its declining competitiveness. This must be addressed by introducing a regional focus to any new economic strategy," he said. He called on the Government to include all of Co Limerick in the proposed multi-agency task force.
Limerick Co Cllr Liam Galvin worked in Kostal for 12 years.
"It's a bad day for Abbeyfeale, a lot of rural villages and the surrounding areas," he said.
"It's not a Dell situation, where they are upping and leaving and going to a cheaper country. At least Kostal are staying here, that's the bright side of it.
"This government has to look at renewing the national pay deal. If the deal comes through as is, manufacturers will not come to this country and the ones here will not be able to sustain what they are doing."
Mallow Labour TD Sean Sherlock warned that the Kostal job cuts underlined the plight facing the entire manufacturing sector in Ireland.
"There is no good time to face redundancy, but in current economic circumstances it is likely to be particularly difficult for workers to find their feet in the short term," he said.
" I am calling on the Tanaiste Mary Coughlan to intervene immediately and to take whatever steps she can to arrest the decline in jobs. in Kostal."