Seagate issued the following statement last night:
Seagate Technology (Clonmel) has today notified the IDA and the Minister for Enterprise, Trade and Employment of its intention to cease manufacturing operations at its Clonmel plant. The plant closure is scheduled to take place when the current product build schedule is completed in early 1998 and will result in over 1,100 regular employees and 300 temporary employees being made redundant.
Seagate Technology regrets having to take this action but it is a necessary step in the company's efforts to remain competitive and maintain its industry leadership position in a challenging business environment. Downward price pressure, intense competition and increasing market fragmentation have placed increasing pressure on Seagate's operating performance, as well as on that of a number of its competitors. Seagate has been reviewing its worldwide operations to improve efficiency, lower costs and bring capacity into line with market requirements. Since the establishment of the Clonmel production facility, the merger of Seagate with Conner Peripherals (February 1996) has resulted in production capacity in excess of Seagate's worldwide requirements. Some of this has been addressed by the closure of select facilities outside Ireland, the deferral of certain other facility expansions and the consolidation of some facilities with previously existing Seagate plants. In this context, the Seagate plant in Clonmel, which has the highest cost-per-drive in the company, cannot be sustained.
Seagate will be working in co-operation with employees, the IDA, local and national government, and the local community to mitigate as much as possible the effects of this closure on the employees. Details of severance packages will be communicated to employees in the coming weeks.
Seagate Technology Inc is a leading provider of technology and products enabling people to store, access and manage information. The company is committed to providing best-in-class products to help people get their information when, where and how they want it.
Ian O'Leary, corporate communications manager