401 workers to affect as UPM plans to close Plattling mill in Germany

The Finnish forest industry company UPM on Tuesday announced plans to permanently close its Plattling mill in Germany, reducing the uncoated and coated publication paper capacity by 595,000 tonnes in Europe, said the UPM in a press release.

An estimated number of 401 employees will be affected by the planned closure.

The planned closure of UPM Plattling’s two paper machines would lead to a permanent reduction of 380,000 tonnes of uncoated publication paper and 215,000 tonnes of coated publication paper.

Both paper machines are planned to stop graphic paper production by the end of 2023.

“Mature graphic paper markets require continuous and relentless efforts to ensure cost competitive operations that also meet the future customer demand. UPM is committed to leading our business in a responsible manner. We respect the interests of both our workforce and our customers and consider them a central part of our plans. We recognize that today's (Tuesday) announcement is very difficult news for our employees in Plattling. Together with the employee representatives, we will seek responsible solutions for our personnel and enter directly into a fair dialogue,” said Massimo Reynaudo, Executive Vice President, UPM Communication Papers.

UPM would recognize restructuring charges of EUR 122 million (EUR 106 million cash impact and an impairment of EUR 16 million) and an impairment of EUR 100 million of the leased CHP plant as items affecting comparability in its Q3 2023 result.

The planned actions are estimated to result in annual fixed cost savings of EUR 60 million.

Meanwhile, UPM Communication Papers plans to continue the temporary layoffs in Finland. The possible temporary layoffs could take place in several periods and would last a maximum of 90 days.

Decisions on the continuation of the possible temporary layoffs in the four mills will be taken after the consultations have been concluded. The total number of employees covered by the employee consultations is approximately 1,100.