Abbott Labs plant to close with loss of 500 jobs

The Abbott Laboratories factory in Galway's Mervue Business Park is to close next year with the loss of all 500 jobs.

A spokeswoman for the company said the closure was not due to cost but rather excess manufacturing capacity in its vascular division sites in Galway, Tipperary and Temecula, California. These sites manufacture stents used to improve blood flow.

She said it was possible that between 50 to 100 of the staff could be relocated to other Abbott units. Abbott has offices in Dublin, Donegal, Clonmel, Sligo, Longford and Cavan.

However, the bulk of the staff will leave the company and the first are due to leave n mid-January before the closure is completed by September 2008. Abbott said it will provide competitive redundancy terms and outplacement services.

In a statement Abbott said it excess manufacturing capacity and that "right-sizing Abbott Vascular is essential to remain a strong performer in a very competitive and important business".

The company went on to said it will continue to have a strong presence in Ireland, where it continues to be one of the country's largest employers with approximately 3,000 people in seven locations and stressed that the move would not effect Abbott's Clonmel facility where 1,300 people are employed.

Abbott has not officially recognised unions at the Galway plant but Michael Kilcoyne, branch organiser for the trade union Siptu, said expected redundancy packages would be too low.

It is believed the company will table a deal worth two years pay to those laid off.

"Workers are shocked and stunned and they are upset by this. In most cases redundancy could be worth less than a year's salary, that's not good enough," Mr Kilcoyne said.

The Minister for Enterprise, Trade and Employment Micheál Martin said the news was a blow for those concerned and said the "job creation agencies of the State will be offering the workers every assistance" .

He said that despite the announcement - due to excess capacity internationally - Abbot continued to have a strong presence in Ireland and remains a major employer.

Minister Éamon Ó Cuív said he regretted very much that Abbott had to make this decision, which he said he understands was made because of a global oversupply in the market for their product.

"With the cooperation of Abbott Ireland and the State agencies, our challenge now is to provide alternative employment and training to the workers as speedily as possible," he said.

"We live in a global economy and the challenge now is to try to attract new industry to Galway so that the industrial base there continues to grow. The recent announcement of further jobs in Galway is a sure example that industrialists still see Galway as an attractive location in which to base businesses."

Parent company Abbott Laboratories, based in Illinois and currently employing 65,000 people worldwide, was established in Ireland in 1946.

In 1974 Abbott Ireland established two manufacturing facilities and has since added a further four more, pushing its Irish workforce to more than 3,000.

Abbott Ireland is now one of the largest overseas branches of the parent company. Additional reporting: PA