Protests in Belgium against restructuring plans announced by Bekaert have cost the company, which produces steel wires and cables, millions of euros, according to its management.
The announced restructuring includes the closure of the Bekaert factory in Moen (Zwevegem) in West Flanders, originally scheduled to cost 281 jobs in Belgium.
Bekaert had announced the restructuring plan in late March. It includes the delocalisation of the operations of the Moen factory, which produces steel rods for concrete, to the Czech Republic. Since then, staff in Moen have been on strike, although the company had not intending closing the factory until the end of the year and was counting on its production until then.
The impact of the social protests since then has already topped five million euros, Bekaert said on Friday at a press conference.
So far, management and unions have failed to agree on a social plan. Bekaert’s CEO, Matthew Taylor, who is from the U.K., hopes a solution can be found quickly when talks resume in mid-July. In the meantime, the number of posts to be cut has gone down from 281 to 250, with some workers likely to be placed on other sites.
The protests have not been limited to Moen. Bekaert reported that the unions at the group’s factory in Zwevegem, which produces metallic fibres, have organised go-slow actions in solidarity with their colleagues at the Moen facility.
While Bekaert’s output for the first half of 2019 met and even surpassed expectations, its second semester forecast is less joyful. “There is much uncertainty; that’s the main message,” its CEO said.
Uncertainty seems, in fact, to reign in many areas where Bekaert is active. Agriculture, for example, has had a difficult year. Chinese taxes imposed as a result of China’s trade war with the United States, together with the weather, have had a very negative impact on the sector. The auto industry also seems uncertain.
CEO Taylor still wants to have a go at costs. That, he says, can mean everything. Bekaert will examine its options worldwide and, in those units that are doing less well, it will see first if it is possible to achieve a turnaround. However, where it appears that no improvement is possible, closures will have to be envisaged, Taylor noted. Nothing is planned for the moment, he added, explaining that the company is concentrating on bringing about a turnaround.
Citing an example, Financial Director Vromant noted: “Ecuador is a country in financial difficulty, with a considerable debt. There are no longer any big investment projects as was previously the case. Given this decreasing demand, which we do not see changing in the next three months, we had to let go of 90 persons in Ecuador last month.”