Henkel winds up final manufacturing facility in the east region
Henkel is depth-analyzing its European supply chain and manufacturing strategy. Unfortunately, the factory situated in East Germany's Heidenau ends up being the target of these improvements. A total of 40 people end up losing their jobs there. Production will relocate to different European locations.
Henkel, a consulting group that specializes in consumer goods, has indicated that the factory based in Heidenau, south of Dresden, will conclude operations by year-end. That decision was taken in May 2021 and agreed upon with the local workers' council.
In a bid to soften the impact on its employees, the company has reached an agreement with the workers' council. This agreement includes provisions for early retirement packages and separation allowances. Additionally, alternatives working opportunities at their German subsidiaries have been presented.
The driving force behind this decision is the optimized European supply chain and manufacturing network. This change affects Henkel's business area dealing with adhesives, sealants, and functional coatings, which has its roots in the Heidenau plant. Production will be shifted to alternate European sites.
On top of the Heidenau facility, Henkel keeps sites in North Rhine-Westphalia, Lower Saxony, Hesse, Baden-Württemberg, and Bavaria in Germany. The multinational organization, headquartered in Düsseldorf, boasts about 48,000 employees globally, with 83% of them working outside Germany.
The company is segmented into two major sections: "Adhesive Technologies" with household names like Pattex and Pritt, and "Consumer Brands" which includes laundry, cleaning, and hair care products like Persil, Pril, and Schwarzkopf. Recently, Henkel reported "outstanding business growth" in a public announcement.
Henkel's decision to optimize its European supply chain and manufacturing network has led to the planned closure of its factory in Heidenau, contributing to the economy-wide job losses of 40 individuals. Despite this, Henkel is offering early retirement packages and separation allowances to soften the impact on its employees.
Henkel's focus on improving its European supply chain and manufacturing strategy may have implications for the local economy in Heidenau, as well as for the broader German economy, given that the multinational organization employs a significant portion of its workforce outside Germany.
