Vetropack consults on future of production in St-Prex

Vetropack consults on production in St-Prex

Vetropack Group has announced that it will start a consultation process on the future of its Swiss production site in St-Prex (VD). For several years, this long-established and historical site has been facing difficulties in terms of location and profitability, which led the Group to launch in-depth analyses to evaluate the possibility of maintaining operations there. The result: The competitiveness and development prospects of the site are negative – and could even result in its closure this year. However, Vetropack’s Board of Directors will only make its decision once the legally required consultation procedure has been completed.

More than a century old, the St-Prex production site has been the subject of numerous changes and substantial investment over the decades – more than CHF50 million since 2010 alone. But despite these efforts, the site – the Group's only one in Switzerland – is suffering from its small size, the constraints of its location in the heart of a densely urbanised area, and its lacking competitiveness in a market that has become increasingly difficult. Its profitability is no longer guaranteed.

These are issues that have been of concern to the Group's management for several years. A decision on the future of the site is necessary now, as the current melting furnace is due to be replaced. This would require an invest of at least CHF 30 million – which is economically not feasible under the current conditions.

In view of these developments, Vetropack's Management Board and Board of Directors have undertaken in-depth analyses of the situation. This has now led to the opening of a consultation process, which could result in the closure of the production site at St-Prex if no other viable alternative can be found. “This is a very difficult situation for us. St-Prex is our only glass production site in the Swiss domestic market, and we are very aware of the impact that a potential closure would have, particularly for our employees”, says Claude Cornaz, Chairman of the Board of Directors. “Nonetheless, the prospects for the plant in terms of competition and development are more than uncertain. We are of course open to any realistic proposal that would make it possible to avoid or limit the number of redundancies and, if necessary, mitigate their impact.”

“Closing the factory would be the last option. It is only an option for us if we no longer see any long-term opportunities to improve the site's performance and secure its competitiveness,” says Johann Reiter, CEO of Vetropack. “For St-Prex, as for every other site, we have examined a whole range of different development scenarios. None of them has led to a positive economic outcome.”

Vetropack still generates around 40% of its sales to Swiss customers with glass packaging from St-Prex. In the case of a closure, these customers would be supplied by other plants, particularly Austria and Italy.