Waihi plant to close

Press, 13 March 1986, Page 8

Waihi plant to close

PA Wellington Up to 170 people will lose their jobs when a Waihi electrical industries plant closes in September. The managing director of Philips Electrical Industries, Mr J. Romme, said yesterday that the factory would be progressively wound down. The staff, up to 170 of whom will be affected by the decision, were informed yesterday afternoon, he said. Mr Romme said that the factory, which produces mainly consumer audio products, had become uneconomic.

“Until recently the consumer electronics industry in New Zealand has been protected by import licence policy and import tariff. Now that these protectionary measures have

been removed, or are being dismantled, local manufacture of audio products has become totally uneconomic.

“Prices of imported product have become cheaper than locally produced items in this range, as the economy of scale in automated mass-pro-duction centres overseas makes small-series production in New Zealand uncompetitive.”

Mr Romme said that in the six years to June, 1985, the value of imported audio products rose more than 450 per cent.

“Under the electronic development plan, import licence tendering allocations for audio amplifiers and radios have risen four-fold in only two years just over $1

million in May 1984’s round one to a predicted $4.7 million in round five, which takes place next month.” He said the effects of these developments on the Waihi enterprise had concerned the company for a number of years. “In 1983 the company was forced to reduce its Waihi workforce because of lower demand for its products in an attempt to maintain its viability. “As local production requirements for audio products has now come to a virtual standstill, the main base-load of the Waihi factory has been eliminated, thus rendering all future operations impractical.”

Mr Romme said the company had kept the Waihi plant

last four years even though it was unprofitable.

Philips was the main employer in Waihi, and aware of its responsibilities to the town’s 3500 people, he said. The company would “do its best” to find alternative employment for its Waihi staff, he said.

“As vacancies within the company are limited at present, we intend to assist our employees by approaching other employers, on their behalf, by means of a job-search programme.

“Philips is the last of the main consumer electronics manufacturers to announce redundancies. Closing the Waihi factory is a step which we take with great reluctance,” he said.