Structural measures implemented to boost competitiveness
Over the last 12 months, Rettig ICC has faced unprecedented challenging trading conditions as the full effect ofthe slump in world trade causes a significant drop in demand for heating products in both new build and renovation segments across all regions in Europe.
Management has responded to the downturn by introducing a number of structural measures that will bring cost reduction either via economies of scale or via specialisation around established manufacturing platforms:
In the UK, the closure of the Bolton towel warmer plant was announced in December 2008 and became effective at the end of June 2009. Production has been transferred to other sites across Rettig ICC, whilst manufacturing ofthe traditional brass products is now assured in the Izmir plant in Turkey, where Rettig acquired a majority stake last year. The former Bolton site is now officially decommissioned with the land made available for sale.
Distribution of Vogel & Noot branded radiators from the Telford warehouse in Shropshire was transferred in June 2009 to the Rettig UK distribution centre in Birtley in North East England. It is now possible for Rettig to optimise distribution for aH brands across the UK using one logistic partner with modem technology. The Vogel & Noot ordering and administration functions have also been transferred to the customer service centre located at Birtley
In Sweden, after local announcements in March 2009, manufacturing of cast granite radiators at the Fellingsbro site was ultimately discontinued in early July 2009 and subsequently transferred to the much larger Rettig plant of Jakobstad in Finland. At a similar time, production of flat tube convector radiators has been transferred from the Jakobstad plant to the Kapfenberg Diemlach plant in Austria. This project is based on the flat tube platform strategy and enables Rettig to combine Nordic demand with existing manufacturing volumes for decorative and design radiators in the Austrian plant.
In France, Rettig has taken progressive steps in concentrating distribution volumes at the distribution centre in Biache St Vaastin Northem France. The last panel radiators despatched from the Strasbourg warehouse took place in February 2009 and despatch of LVI electric products was also transferred from Angers to Biache a month later. The order administration·previously conducted at Clermont Ferrand has been transferred to the larger administrative centre of Le Blanc Mesnil in the Parisian area.
Rettig ICC sincerely regrets aH job losses made necessary by these steps to confront the severest downturn in economic activity since the 1920s. This sequence of measured steps ho wever have been implemented with the conviction that customers can continue to believe in Rettig ICC as a secure business partner which offers via its well known professional brands both competitive and attractive products and services in a much tougher business environment.