Danone is planning to shut down a dairy plant in Germany, citing high production costs and underutilization of the facility as primary factors.
The Activia manufacturer announced that the closure of its Ochsenfurt site is aimed for the final quarter of next year.
In its statement, Danone emphasized that this decision is crucial to maintaining “competitiveness and success in the long term in German-speaking countries”. Approximately 230 jobs will be impacted.
According to the company, production costs at the Ochsenfurt plant are “well above the average of other European Danone plants”. Additionally, it pointed to “years of inefficiency caused by declining capacity utilisation.”
Looking ahead, Danone expects the facility’s capacity utilization to reach only half of 2019 levels by 2024, thus making the closure “unavoidable”.
Richard Trechman, managing director of Danone’s operations in Germany, stated that the plant is “not sustainable in the current market situation”.
He further noted, “There is less consumer demand for the locally manufactured products and high-potential Danone products cannot be produced locally.”
The Ochsenfurt facility primarily manufactures dairy products, desserts, and high-protein puddings. When asked about potential sources for these products in Germany post-closure, a spokesperson indicated, “Where the products will be concretely produced after the planned closure will be decided in the coming months.”
Despite the closure, Danone has reiterated its commitment to Germany as a manufacturing hub, planning “significant investments” at its Fulda facility.
The Fulda plant employs nearly 600 people and focuses on specialized products such as baby formula and medical nutrition.
The spokesperson emphasized, “Our Fulda facility is one of Danone’s largest production sites globally, supplying products to over 70 countries, including Germany. It plays an important role in the company’s overall strategy, and we invest every year a double-digit million euro amount in modern, high-tech production capabilities.”
Looking to assist affected employees, Danone plans to review vacancies at the Fulda plant, providing retraining opportunities for those impacted by the Ochsenfurt closure.
