Industrial C&S Hungary

Type
Closure
Country
Hungary
Region
Alföld és Észak; Észak-Magyarország; Borsod-Abaúj-Zemplén
Location of affected unit(s)
Ózd
Sector
Manufacturing
(26 - 27) Manufacture of electrical, electronic and optical products
27.9 - Manufacture of other electrical equipment
27.90 - Manufacture of other electrical equipment
1,000 jobs
Number of planned job losses
Job loss
Announcement Date
11 February 2020
Employment effect (start)
11 February 2020
Foreseen end date
31 December 2020

Description

Swiss-Swedish multinational firm ABB (ASEA Brown Boveri) announced the closure of its Ózd unit by the end of 2020. As a result, 1,000 workers will be dismissed.

The Ózd plant – under the business name ’Industrial C&S Hungary’ – mostly produces disconnectors, contactors, circuit breakers. The output of the production unit has been on a continuous downward trend, due to decreasing demand, and soon it will reach a point where keeping the plant operating makes no economic sense. The plant made an after-tax loss of HUF 13 billion (€38.59 million) in 2018 - part of this loss can be attributed to a large-scale product recall in that year. The remaining – already reduced – productive equipment will be distributed to various ABB units within the region. The decision does not affect the other Hungarian ABB sites (another plant, logistical units, maintenance workshop, robotics office).

The firm pledged to support the laid-off personnel above what is prescribed by the Labour Code. It will co-operate with the employment agency to help employees find new jobs either at other firms in the region or at another Hungarian ABB unit. The company will also support workers' participation in vocational retraining or help them launch their own businesses.

Due to the magnitude of the dismissal, the innovation and technology minister initiated a negotiation with municipality officials and with ABB suppliers to facilitate the job-seeking support. Ózd is located in a county where unemployment is much higher than the national average, and employers typically do not face labour shortage.

Sources

Citation

Eurofound (2020), Industrial C&S Hungary, Closure in Hungary, factsheet number 99824, European Restructuring Monitor. Dublin, https://apps.eurofound.europa.eu/restructuring-events/detail/99824.