Up to 300 jobs are to go at car components plants in Limerick and Cork, it was announced today.
Kostal, which employs some 1,000 people in Abbeyfeale, Co Limerick, and Mallow, Co Cork, told staff at both plants of its restructuring plans at simultaneous meetings this morning.
Two hundred redundancies are being sought Abbeyfeale, while 100 more are being sought in Mallow, management said today. It is understood the redundancies would be voluntary. However, if enough applications are not received, compulsory lay-offs may be introduced.
Staff at both plants will also have a three-day week every second week until the end of March.
Union officials said the job losses would be a major blow to the areas. The company is to meet with unions to plan a strategy to maintain its Irish operations in the long term.
The motor industry in Europe, to which German-owned Kostal supplies components, is currently experiencing its lowest new year sales in years following the global credit crunch. Workers at the company have been on short time since December because of the downturn in business.
Orders at Kostal fell 30 per cent last year, a situation that is not expected to improve in the near future.
Labour Party TD for Cork East Séan Sherlock said the announcement was further evidence that the manufacturing sector was in "serious decline", particularly in North Cork.
"The North Cork region has taken a hammering in recent years, and I'm calling on the Tánaiste to intervene in this matter, and to take whatever steps she can to arrest the decline in jobs in Kostal," he said.
"State agencies must get involved to ensure a viable future for the company, while the National Training Fund must be made available to allow Kostal workers who are to be let go, upskill without loss of benefits."
Fine Gael TD Jimmy Deenihan said the 200 job losses in Abbeyfeale would be a "terrible blow" to the region. He called on the Government and State agencies to assist the company.
"This is the worst possible time to have to look for work, in the midst of a deep recession. I am calling on all relevant State agencies to do everything they can to provide retraining and upskilling to the workers and to help them to find alternative employment," he said.
"This is yet another blow to the region following the loss of 1,900 jobs at Dell. Kostal is a major employer in the area and has played a crucial role in providing work and local economic stimulus. West Limerick and North Kerry have been ignored and neglected for too long and urgently need new investment."
There are also fears for 400 jobs at RR Donnelly in Limerick, which is heavily reliant on business from Dell. The company prepares kits that accompany computer packages.
Siptu also revealed yesterday its members at RR Donnelly had said they had been informed by management of the company’s impending closure in Limerick. It is feared the jobs will be lost between now and next October as the Dell manufacturing switches to Poland.
Siptu's sectoral organiser Karan O'Loughlin called on the Government to produce a programme of support for manufacturing industry in Ireland.
"Surely the general population must be asking themselves how the economy has fallen so far in such a short time," she said.
"It is only 18 months since the general election when the Government told people not to trust anybody; that they were the only ones capable of managing the economy. This is the same economy that is now disintegrating around us.
Ms O'Loughlin said it was time for "new thinking" and called for the establishment of a state agency to help businesses meet their regulatory obligations.
"We need a fundamental bedrock of manufacturing employment in this country to support the economy," she said.
"The third level institutions across the country need to work with the agencies tasked with bringing industry in to the country. Together they need to identify the industries of the future. Simultaneously they need to identify the competencies and qualifications required by these industries so that the appropriate education strategy can be designed to attract high end industry with quality jobs."