Engel to close Guelph manufacturing facility

Engel Canada has announced that it will stop manufacturing machines in Guelph by May 2008, shedding 225 jobs from its Canadian operations.

The company will only retain approximately 30 employees in Guelph, dealing mainly in sales, service and spare parts. This would mark the end of Engel’s injection molding machinery manufacturing operations in Canada. However, the Guelph facility will continue to produce key molding cell automation systems.

Employees at the facility were notified about the company’s decision to stop manufacturing in Guelph yesterday.

The Guelph, Ont. facility formerly served as Engel’s North American headquarters, but company headquarters were relocated to York, Penn. last year. Additionally, the company announced plans to focus on small- and medium-sized machines in Guelph, and large-capacity machines in York.

“Guelph will concentrate on the production of Speed and E-Motion machines from 200 to 500 tonnes clamping force as well as on special machines and systems adapted to the growing market for all-electric machines and machines for packaging applications,” the company said in June 2007.

At the time, Engel Canada’s Austrian parent company Engel Austria GmbH also announced that it would invest US$4 million to modernize its North American production network.

“With a reduced market for standard machines, especially for the production facility in Canada, some changes in manufacturing processes are required to maintain profitability,” said Engel North America CEO Steve Braig early last year.

Last year’s plans to reorient and refocus Engel’s Canadian operation are in sharp contrast to yesterday’s announcement. The production of small- and medium-sized machines will be transferred to the York facility, the company said.

“The North American injection molding machine market has decreased from 6,200 machines annually in 2000 to approximately 3,000 machines in 2007,” said Braig in a statement yesterday. “This decreased market demand necessitates consolidation of our manufacturing operations into one facility.”

Engel said it is currently negotiating with a potential buyer for the Guelph manufacturing facility.