EMCC European Monitoring Centre on Change

Szarvasi Vas-Fémipari

Company/Organisation:
Szarvasi Vas-Fémipari

Geographic Location

Country: Hungary
Region: Bekes; Del-Alfold; Alfod es Eszak
Location of affected unit(s): Szarvas

Company

Sector: Manufacturing
Manufacture of electrical equipment
27.51 - Manufacture of electric domestic appliances
Number Employed: 200

Employment Effects

Announcement Date: 23-01-2019
Planned Job Reductions min: 200
Planned Job Reductions max: 400
Type of Restructuring: Closure
Employment Effect Start: 01-09-2018
Foreseen End Date: 28-02-2019

Additional Information

Hungarian electric equipment manufacturer Szarvasi Vas-Fémipari announced the closure of its plant on 23 January. As a result, more than 200 workers, both the firm’s own employees and agency workers, lost their job. The the firm made an agreement with a number of other companies, former business partners, about having 60 of these workers transferred to these companies. In 2018 the plant had 400 workers but had to dismiss half of them as it was entering financial difficulties.

While the company was best known for its coffee makers, producing lamps was its main field of activity. In early 2018, the firm embarked on a costly investment program to enhance its lamp production capacities so as to win a new large-scale order from furniture retailer Ikea. But Ikea soon withdrew its order, citing quality problems. Accumulating operating loss and liquidity problems eventually forced the 66 years old company to close its doors.

Szarvasi Vas-Fémipari has been a defining fixture and an important employer in the city of Szarvas for many decades. The government announced that it did not plan to bail out the company as it previously had done in the case of another important employer in the same county but that it would support the workers in finding new jobs. 

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