Sumitomo Electric Cable Systems terminates employment of 600 workers in Romania, following its previous decision to shut down the entire plant in Bulgaria last September.
Revised Article:
Sumitomo Electric Bordnetze, known for its cable manufacturing in the automotive sector, is trimming its team across Romania and Bulgaria factories, according to a report by Economica, quoting the regional labor bureau AJOFM.
Here's the lowdown on what's happening:
In Romania, the Japanese company plans to let go of 676 employees out of 1,712 in Drobeta Turnu Severin, aligning with its ongoing workforce reduction strategy in the region. This aggressively shrinking workforce echoes the closing of a factory this year (the group also operates in Moldova, at Orhei, employing 3,500 people).
The company's three factories in Romania, located in Caransebeş, Drobeta Turnu Severin, and Târgu-Jiu, collectively reduced their employee headcount to an average of 5,604 in 2023, a notable decrease of 709 compared to the previous year. The company's workforce in Romania has continued to dwindle since 2021.
The workforce’s shrinkage in Bulgaria was announced last September by SEBN with a proposed reorganization of its activities over the next couple of years, including manufacturing operations transfer to Romania and Moldova, leading to a reduction of over 1,000 employees out of a total of 1,950, also involving the shutdown of one plant.
These actions mark a second significant industrial development in Drobeta Turnu Severin in recent weeks, following the takeover of the insolvent tire factory Euro Tires Manufacturing by Yokohama Rubber for EUR 32 million.
The automotive industry has been battered by significant supply chain disruptions, particularly due to semiconductor shortages, and fluctuating demands for certain vehicle models. Additionally, Sumitomo Electric Bordnetze's restructuring aims to cut operational costs, boost efficiency, and stay competitive. Some manufacturing activities may even be realigned to other locations or shifted to new technologies such as electric vehicle wiring production.
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- The restructuring in Sumitomo Electric Bordnetze extends beyond the automotive sector, as it also involves finance decisions, such as reducing costs and improving efficiency.
- The transportation industry is not immune to Sumitomo Electric Bordnetze's restructuring, with manufacturing operations being transferred from Bulgaria to neighboring countries like Romania and Moldova.
- The business impact of Sumitomo Electric Bordnetze's restructuring is not limited to the automotive sector, as it also includes changes in manufacturing processes, potentially leading to the production of electric vehicle wiring in new locations.
