BRUSSELS (Reuters) - Belgian chemical company Solvay (SOLB.BR) said on Friday it was closing two sites of its composite materials business with the loss of some 570 jobs in the United States and Britain as it accelerated its restructuring due to the COVID-19 pandemic.
The division, which makes plastics, resins and carbon fibre material for the aerospace industry, had already started a cost-cutting programme due to reduced production of Boeing’s (BA.N) grounded 737 MAX plane.
However, this was not sufficient to overcome the drop in expected demand for civil aircraft caused due to COVID-19.
Solvay said on Friday it would deepen and accelerate the plan by ceasing industrial operations at its plants in Manchester, England, and Tulsa, Oklahoma, with the transfer of some activities to other plants.
The total headcount of the division would fall by about 20%.
“These structural changes will enable the business to adapt its cost structures and to partially mitigate the downturn in the near term,” Solvay said in a statement.
The plan would result in annualised savings of about 60 million euros ($64.8 million) by the end of 2020. A restructuring charge of 30 million euros will be taken in the second quarter.
($1 = 0.9257 euros)
Reporting by Philip Blenkinsop; Editing by Jan Harvey