Valmet Automotive-manufactured cars were loaded onto a car carrier trailer at the Port of Uusikaupunki in Southern Finland in November 2021. The Finnish automotive contract manufacturer said earlier this week it will reduce its headcount by up to 940 due to a decline in production volume. (Roni Lehti – Lehtikuva)


VALMET AUTOMOTIVE, an automotive contract manufacturer based in Uusikaupunki, Finland, on Monday announced it will sack about 500 employees at its assembly plant.

The Finnish company said it will need to reduce at most 940 employees in response to a drop in production volumes, adding that about half of the reductions would be carried out by lay-offs and half by temporary lay-offs of an indefinite duration.

“We’re ultimately talking about a permanent decline in production volume. The changes in the global automotive industry and recent geopolitical events have had an effect also on us. Production will continue, but it’ll be scaled to match market demand,” Pasi Rannus, the director of manufacturing at Valmet Automotive, stated to YLE on Monday.

Changes will also be made to job descriptions.

The negotiations with staff representatives were launched in January. The redundancies will implemented out between late April and early May, leaving roughly 1,400 employees at the plant in Uusikaupunki.

The plant is expected to require an additional 150 employees in the autumn as it start producing the AMG GT roadster for Mercedes-Benz. Rannus, though, declined to speculate on when and to what extent the laid off employees could be brought back, as well as on the duration of the temporary lay-offs.

“The employer has a certain take-back obligation, but it’s too early to speculate,” he said. “We can’t provide any timelines at this point.”

Rannus stated that he is confident that the electrification of road transport will provide a boost also to the company in the coming years. “The demand for our services will only grow in the future,” he stated.

Jarkko Heinonen, the director of business and economic development at the City of Uusikaupunki, similarly expressed his confidence in the future of the assembly plant after the sad news. “We’ll try to make sure those laid off will find new jobs. There’s still demand for labour in the region,” he said to the public broadcasting service.

“The assembly plant’s labour situation has always fluctuated,” he reminded.

Aleksi Teivainen – HT