EMCC European Monitoring Centre on Change

Industrial C&S Hungary

Company/Organisation:
Industrial C&S Hungary

Geographic Location

Country: Hungary
Region: Borsod-Abauj-Zemplen; Eszak-Magyarorszag; Alfod es Eszak
Location of affected unit(s): Ózd

Company

Sector: Manufacturing
Manufacture of electrical equipment
27.90 - Manufacture of other electrical equipment
Number Employed: 1000
Group: ABB

Employment Effects

Announcement Date: 11-02-2020
Planned Job Reductions min: 1000
Type of Restructuring: Closure
Employment Effect Start: 11-02-2020
Foreseen End Date: 31-12-2020
Direct Dismissals: 1000

Additional Information

Swiss-Swedish multinational firm ABB (ASEA Brown Boveri) announced the closure of its Ózd unit by the end of 2020. As a result, 1,000 workers will be dismissed.

The Ózd plant – under the business name ’Industrial C&S Hungary’ – mostly produces disconnectors, contactors, circuit breakers. The output of the production unit has been on a continuous downward trend, due to decreasing demand, and soon it will reach a point where keeping the plant operating makes no economic sense. The plant made an after-tax loss of HUF 13 billion (€38.59 million) in 2018 - part of this loss can be attributed to a large-scale product recall in that year. The remaining – already reduced – productive equipment will be distributed to various ABB units within the region. The decision does not affect the other Hungarian ABB sites (another plant, logistical units, maintenance workshop, robotics office).

The firm pledged to support the laid-off personnel above what is prescribed by the Labour Code. It will co-operate with the employment agency to help employees find new jobs either at other firms in the region or at another Hungarian ABB unit. The company will also support workers' participation in vocational retraining or help them launch their own businesses.

Due to the magnitude of the dismissal, the innovation and technology minister initiated a negotiation with municipality officials and with ABB suppliers to facilitate the job-seeking support. Ózd is located in a county where unemployment is much higher than the national average, and employers typically do not face labour shortage.

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