Seagate has decided to delay work on the £150 million extension to its plant at Springtown in Derry, some weeks after the British Prime Minister, Mr Tony Blair, paid it a visit. It also follows September's official opening of a new Seagate facility at Limavady, Co Derry, an investment of $90 million.
In recent weeks, the first hint that all was not well within the Springtown plant came when staff members complained to local newspapers that they had been told to take an unscheduled and unpaid week-long holiday over the Christmas period. That allegation produced a blunt denial from management at the Derry plant.
Seagate opened its disk wafer plant in Derry four years ago. The company's decision to locate in Derry was a direct result of a chance meeting in a bar in California between the SDLP leader, Mr John Hume, and Seagate's executive vice-president, Dr Brendan Hegarty.
Since it started operations in Derry, Seagate had, until yesterday, enjoyed unprecedented success and continued growth. Production targets were constantly met. The company's in-house brochure has the words "Watch Us Grow" on its front cover and that motto was reflected by the constant expansion and fresh job creations at the Springtown plant.
Some 1,000 people work in the Derry plant and that figure had been expected to rise to 1,200 within the next six months.
The company's latest expansion at Springtown started several months ago. Construction work at the site is at an advanced stage and floodlighting enables work to continue throughout the night.
Dr Hegarty, who is also Seagate's chief operating officer, said in his statement yesterday that the expansion would be delayed by up to six months. He said the delay was due to "continued softness in disk drive demand, particularly in the high-end market segment".