Konecranes' business area equipment to reallocate resources to emerging markets
As a result of new equipment demand moving towards emerging markets, Konecranes Business Area Equipment has initiated actions to align operations closer to customers.
In doing so, the Group, in its Business Unit Industrial Cranes will organize itself into larger sales areas with fewer, yet stronger units.
In addition, we will consider discontinuing industrial crane manufacturing in Hyvinkää, Finland and Vic, Spain. Hyvinkää will remain the main location for component manufacturing for heavy-duty industrial cranes and port cranes.
In our Business Unit Port Cranes we consider terminating straddle carrier manufacturing in Tauberbischofsheim, Germany. In straddle carrier manufacturing we will continue using other Group facilities, as well as the Group´s extensive subcontracting network.
These actions will affect approximately 140 employees globally. Konecranes expects to incur restructuring costs of approximately EUR 10 million due to these actions of which approximately EUR 6 million will be recognized in the fourth quarter of 2012 and approximately EUR 4 million in the first quarter of 2013. The total cash flow impact of these restructuring costs will be approximately EUR 5 million. With these planned actions, Konecranes targets annual cost savings of approximately EUR 10 million starting from the second half of 2013 on.
Due to this business reorganization, Konecranes will start statutory negotiations regarding possible personnel reductions in Finland. We estimate that the permanent personnel reductions will affect 35 employees within the Business Area Equipment. The planned changes in Finland are part of the Business Area wide realignment of operations.