Sep 2 2005
Following an in depth analysis of its production structure over the past several months, the LEGO Group has given its employees details of plans which will lead to significant adjustments within the organisation.
It is expected that all Swiss based production will transfer to Eastern Europe during the first half of 2006. The planned move will mean closure of the Willisau factory, where 239 employees will lose their jobs. Production is expected to transfer to the Group’s own plant in the Czech Republic and to external suppliers. It is not yet known how many new jobs will result from the move.
Commenting upon the expected closure of the Willisau production facility, Lars Altemark, Senior Vice President, Global Supply Chain, says:
“Obviously high costs in Switzerland have been a key factor in deciding to transfer production to Eastern Europe. And to derive maximum benefit from our cost reductions it is also important to move whole units – as we now plan to do with Swiss production.”
The LEGO Group is expected at the same time to close its Swiss tooling works in Steinhausen. As production times from idea to finished product necessarily shorten, the need for new moulds fluctuates considerably, which means that the tooling works is no longer able to use its capacity to the full. In addition, the higher cost level can no longer compete with prices in Eastern Europe and China. In future, the Group will buy more of its moulds from external suppliers.
Over the next few months the LEGO Group will investigate the prospect of finding a new owner for the plant. If this is not possible, the facility is expected to close at the end of January 2006.
The Steinhausen plant employs a total of 68 people.