Putting some specifics to plans it announced in February to cut its workforce about 10%, Merck KGaA says two production facilities will be closed as part of the downsizing.
A salt production operation in Lehrte, Germany, is targeted as well as filling operations in Hohenbrunn, Germany, the company said in a release Monday. About 140 employees will be "responsibly" whacked in those two closures.
The company says it and worker representatives agreed to cut 1,100 of the 10,900 positions in Germany by the end of 2015, "in a socially acceptable manner, mainly through voluntary-resignation and early retirement programs across all divisions and functions."
Merck earlier this year said it had to lighten its cost structure significantly as patent losses and disappointments in development set the stage for a much tougher revenue landscape.
Manufacturing, however, was mostly spared when it put the finishing touches on a restructuring plan for Merck Serono that closes the Geneva half of its two-headquarters setup and eliminates about 500 jobs. Among those cuts were about 80 positions at manufacturing operations in Aubonne, Corsier-sur-Vevey and Coinsins in Switzerland. Aubonne picked up 130 technical manufacturing positions that had been in Geneva. Merck is closing its manufacturing operations in Coinsins and relocating those functions to its facility in Aubonne.
As part of the cuts in Germany, Merck says it will reorganize some support functions, like logistics. It said with a few exceptions, it won't replace jobs with outsourced employees. Those exceptions, however, fall on manufacturing. The company says it already is partially outsourcing "routine" regulatory affairs jobs and some that involve "considerable manual labor, such as certain blending and filling activities in production." About 100 jobs will be outsourced.
Even as it is cutting jobs to save costs, the company says it will invest about €250 million ($314.6 million) in German sites in the next two years, to make its headquarters in Darmstadt "a state-of-the-art production and research center."
- here's the release
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