Rabat - Canadian-owned Bombardier Aerospace has decided to move a portion of its operations from Northern Ireland to Morocco.
Rabat – Canadian-owned Bombardier Aerospace has decided to move a portion of its operations from Northern Ireland to Morocco.
According to Belfast Telegraph, the move is due to the plane manufacturer’s inability “to undertake competitively in Northern Ireland”. Therefore, it has sought to balance its cost by opening sites in Morocco and Mexico.
According to the Irish newspaper, the plane maker’s decision to choose new, less costly sites is to make most effective use of their “manufacturing footprint and ensure the future success of [their] business overall.”
This does not mean that the aerospace giant will abandon its Belfast site, but rather to transfer “certain activities” to the new sites. Northern Ireland has received a huge investment from the company, which will continue to “focus on high-value, high-complexity production.”
The company adds that “It is absolutely critical that we continue to transfer work packages in which we are no longer competitive so we can safeguard the long-term future of our Northern Ireland operations”
Bombardier is making a gradual transition into Moroccan and Mexican sites. “We regularly send working parties from Belfast to Morocco, Mexico and other Bombardier sites, as well as to China, and we also host reciprocal working parties here,” the company says.
According to one employee quoted by the Irish Telegraph, the Mexican site is fully prepared to begin production. “At present it [the Mexico factory] can make almost any structure and will do so soon.” Another worker confirmed, “there has been a lot of the really old legacy contract work moving to Morocco and Mexico due to cost.”
The company laid off 700 workers this year and has another 1,080 more scheduled next year. In addition to this, the company has undertaken a series of austerity procedures to cut down its costs and survive its “serious financial crisis.” The budgetary restrictions include announcing a pay freeze this year.
Bombardier, which announced $ 18.2 billion in revenue in 2015, is not the first manufacturer to show interest in Morocco recently. Its decision echoes other manufacturers who see the Kingdom as an emerging business hub due to its cheap labor and developing infrastructure.