Several hundred jobs were under threat at Ericsson's Irish operations last night as IDA Ireland blamed the loss of the 800-job Teradyne project last week on planning delays.
Ericsson, which made 100 staff redundant at its Dublin plant in June, is believed to be preparing to cut between 100 and 200 jobs from its 2,400 strong Irish workforce. Management is expected to brief staff later today or early next week.
An Ericsson Ireland spokesman would neither confirm nor deny last night that job losses were planned. The Swedish group said in March that it was embarking on a major efficiency programme which would involve 17,000 redundancies. Ericsson - one of the leading mobile phone manufacturers - has been hit hard by the slowing telecoms market.
Meanwhile, the fall-out from the postponed Teradyne project in Cavan - announced last week - continued yesterday. Senior IDA sources have said that the development agency is convinced that if the Teradyne project had commenced on schedule, the US company would have been too deeply committed to Cavan to cancel the project.
"They would have been up and running at this stage," he said.
Cavan Co Council gave the go-ahead for the project in April, but it was appealed to An Bord Pleanβla by concerned locals. A spokeswoman for Teradyne confirmed that the company received planning permission from An Bord Pleanβla for the 94-acre development only a few days before the plug was pulled on the project.
She declined to speculate on whether the planning delay contributed to the decision to abandon the first significant inward investment project to come to Cavan in over 20 years.
Teradyne makes equipment for the telecommunications industry and was to invest £50 million (€63.49 million) on a new 220,000 sq ft Irish plant. The project was abandoned in the wake of third- quarter losses of $50 million (€55.7 million) at its US parent, blamed on difficult business conditions.
There is growing concern within the IDA that the tortuous planning process is becoming a significant issue in the difficult battle to attract inward investment to regions outside Dublin. The loss of the Teradyne project underlines the need to remove all possible obstacles to the speedy progress of investment projects once they have been announced, according to IDA sources.
They pointed out that Xerox remains committed to its operations in Dundalk - which employs 2,200 - despite having embarked on a $1 billion cost-cutting exercise this year. The Dundalk operation was key to the company's European strategy, explained an IDA source.
The IDA is now required to locate at least half of all new inward investment in the Border, Midlands and Western region. To overcome the difficulties imposed by the planning system, the agency wants to develop a number of strategic centres for the development of new flagship industries.
These will probably be in what it calls "knowledge-based industries" such as bio-technology and software. The IDA will seek to have the sites designated as Strategic Development Zones under the Planning and Development Act 2000, which will circumvent the planning process.
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