Solvay to shutter two plants, cut 570 jobs as aerospace materials demand drops
The Belgium-based chemical maker will close its plants in Manchester, UK, and Tulsa, Oklahoma, and implement job reductions across its composite materials business.
In an acceleration of its restructuring due to the COVID-19 pandemic, Belgian chemical maker Solvay has announced plans to close composite materials plants in Britain and the United States and cut approximately 570 jobs, or 20 per cent of its global workforce.
Solvay’s composite materials business intends to cease industrial operations at its plants in Manchester, UK, and Tulsa, Oklahoma, with the transfer of some activities to other plants.
In addition, job reductions are being implemented across the business.
The implementation of this plan is expected to be largely complete by the end of 2020, Solvay officials said in a May 15 statement, and will result in annualized cost savings of approximately €60 million. A restructuring charge of around €30 million will be taken in Q2, the statement added.
The composites materials division, which makes plastics, resins and carbon fibre material for the aerospace industry, had already started a cost-cutting program due to reduced production of Boeing’s grounded 737 MAX plane. “These steps led to record results in 2019 and sustained performance in the first quarter 2020, but are not sufficient to overcome the significant headwinds related to COVID-19,” Solvay’s statement said. “The current crisis has triggered an industry-wide reduction in expected demand in civil aircraft build rates for the near term.”
“The decision to part company with employees is never one that we take lightly,” said CEO Ilham Kadri. “The steps we are taking are necessary to adapt to the dynamic environment and ensure that Solvay is competitive and strongly positioned to meet our customers’ needs as growth eventually resumes – which it will.”