May 20 2004
Gemplus International S.A., the world's leading provider of smart card solutions, today announces a further step in the implementation of its global operational strategy, aimed at rationalising its manufacturing capacity to continue to build a more efficient organisation for the benefit of its customers.
The step announced today results from the sector's general over-capacity for the manufacture of PVC* card bodies in Europe. In order to align its operations with the current realities of the market, and to strengthen its ability to respond to future opportunities, Gemplus is proposing to implement this further step to restructure its European production sites.
There are three key intentions: 1) To operate with one specialist PVC site in Europe, at Havant, England. 2) To concentrate its activities (mainly personalization) for Germany on one site, in Filderstadt. 3) To close its other German manufacturing facility in Herne.
The plans foresee the transfer of all Herne's PVC activities to Havant; and its local activities, including the personalization of German bank and Healthcare cards, to Filderstadt. The salesforce, technical consultants and the R&D team at Ismaning, Germany, are unaffected by these plans.
Havant is well positioned to become a specialist centre for PVC activity in Europe, since it already successfully supplies the fast-growing bankcard market in the UK. Equally, Filderstadt has a strong reputation for its current activities, and is best placed to respond to the significant opportunities which Gemplus foresees developing in the German market. However, as a result of the changing demands in the marketplace, Herne's manufacturing and embedding activities have been witnessing a progressive decline.
The proposed plan for Herne could result in some 180 redundancies. Gemplus currently employs some 350 employees in Germany. A plan for the transfer of some employees within the group will be offered and supported.
This is part of the execution of the restructuring plan announced by CEO Alex Mandl on 9th December 2002, in line with the group strategy.
Commenting on the restructuring, Philippe Combes, Executive Vice President of Operations, Gemplus, said: "As markets evolve, so must our policies. Clearly, it is imperative that we review our operations, streamline our business where necessary to ensure that we are competitive, and develop a global strategy which gives us the best opportunities for long-term success. This includes establishing an appropriate structure for Germany, so that we can continue to serve our clients there with the greatest efficiency, and position Gemplus to make the most of future opportunities in this important market."
Johannis Debissis, General Manager, Gemplus MIDS GmbH, added: "We deeply regret that this proposal today entails a number of job losses. We understand the difficult impact of these decisions, and we will be taking all reasonable measures to provide appropriate support for all those who may be affected."
For more information about PVC, click here.