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© kheng-guan-toh-dreamstime.com Electronics Production | January 10, 2014

AB Elektronik close down in Germany

TT electronics plans to restructure its AB Elektronik business in Werne, Germany. As a part of TT's operational improvement plan the Group is planning to relocate manufacturing operations to facilities in better cost regions.
At the same time, TT is increasing investment in its Centre of Excellence for Research & Development and New Product Innovation in Werne, and its global sales capabilities building on established engineering expertise and strong customer relationships. Success with major global customers continues to gather momentum.

As previously indicated, the Operational Improvement Plan will have an overall exceptional cost of approximately GBP 30 million, with efficiency benefits of approximately GBP 8 million per annum from the second half of 2015. To ensure the smooth implementation of the Plan, one-off operational inefficiencies will arise during 2014 due to the phased transfer of production, higher inventory build and doubling up of production costs for a period of time. Whilst overall profitability is anticipated to improve, these operational inefficiencies will impact reported operating profit and hold back margin progression of Sensing and Control in the current year.

Commenting on the Plan, Geraint Anderson, Group Chief Executive said:
"The increased investment in product innovation and sales in Germany and the relocation of manufacturing from Werne to our better cost facilities are key steps in our broader strategy to drive growth and make TT more competitive. Whilst they will take time to implement, this announcement represents a significant step forward for the Group and, combined with our strong order book, provides confidence as we enter 2014"

Consultation with the workforce representatives has commenced.
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November 15 2018 5:25 pm V11.9.0-2