Irish Icon Waterford May Move Production

Crystal division of Waterford Wedgwood wants to cut its work force in Ireland nearly in half and could shift much of its crystal production to lower-cost Slovenia.

DUBLIN, Ireland (AP) — The crystal division of Waterford Wedgwood PLC, an icon of Irish artisanship, wants to cut its work force in Ireland nearly in half and could shift much of its crystal production to lower-cost Slovenia, labor union officials said Wednesday.
The crystal plant in the southeast Irish city of Waterford — home of crystal production for more than two centuries — has seen its work force repeatedly pruned since Waterford's high-sales heyday of the 1990s.
Company directors want to lay off nearly 400 employees, or 44 percent of the work force, in coming months, officials from the Amalgamated Transport and General Workers Union, which represents most of the remaining 900 Waterford workers in Ireland.
They warned that the Waterford plant was in danger of being reduced to the status of a tourist attraction rather than a serious manufacturing site.
Waterford Wedgwood declined to comment on the union's claims, saying negotiations on making the factory more cost-effective had just begun and would take days to resolve.
The chairman and top shareholder, Sir Anthony O'Reilly, told the annual general meeting Oct. 11 that the company was about to launch a final round of restructuring in hopes of returning it to profit following years of deepening red ink.
The company has issued more than euro400 million (US$580 million) in new shares in the past four years to fund layoff packages, plant shutdowns and other restructuring costs.
Waterford Wedgwood has declined to confirm or deny Irish media reports that the company is negotiating with Steklarna Rogaska d.d., a glass manufacturer based in Ljubljana, Slovenia, to shift more production lines from Waterford to the central European country. The Slovenian company already produces one Waterford-branded line of hand-cut crystal, Marquis.
Waterford Wedgwood, the world's top-selling maker of crystal and fine china, has struggled to survive in recent years because of changing consumer tastes, lower-priced competition from Asian-based producers, and lost profits because of the collapsing value of the U.S. dollar. The United States traditionally accounts for at least half of worldwide Waterford sales.
''Waterford Wedgwood is doing its best to contemporize its products, to appeal to younger tastes — to people who want, for instance, to be able to put their tableware into dishwashers without damaging it — but the company is under pressure from all directions,'' said Philip O'Sullivan, an analyst at Goodbody Stockbrokers in Dublin.
The crystal division shut its other Irish plant two years ago and increasingly has looked to shift production overseas, including to Brazil, where Waterford-branded wine glasses are produced. Some Wedgwood ceramics, meanwhile, are being produced in a new plant near Jakarta, Indonesia, rather than in their traditional English home.
Waterford was founded in 1759 in the southeast Irish city of the same name. It merged with English fine-china specialist Wedgwood in 1986. The combined operation's shares have plummeted a staggering 95 percent since 2002, the last year that delivered a net profit.
Waterford Wedgwood's battered shares, long reduced to penny-stock status, rose a fraction of a cent Wednesday to 2.8 euro cents (4.05 U.S. cents).
In June, Waterford Wedgwood reported debts rising 10.9 percent to euro412.2 million ($584.5 million), more than double its stock value.
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