Nestle set to cut 600 UK jobs and close Newcastle factory

Food manufacturing giant Nestle is set to close it's Fawdon plant by the end of 2023, which could see the loss of almost 500 jobs.

The company’s site in Fawdon, near Newcastle, which produces fruit pastilles, will close at the end of 2023 costing 475 jobs.

Meanwhile changed working practices at the York, which produces Kit Kats, site will see 98 losses.

The GMB Union say they will try to fight the changes.

Ross Murdoch, GMB National Officer, said:

“To ruin hundreds of lives in a ruthless pursuit of profits, to the very workers who’ve kept the company going during a global pandemic, is sickening.

“Nestle is the largest food producer in the world, with astronomical profits. It can afford to treat workers right.

“Instead, they’ve allowed factories to deteriorate, outsourced production overseas and now slashed 600 jobs.

“It’s corporate greed at its worst – GMB and Unite will fight for every job.”

A statement from Nestle says:

"We are proposing changes to adapt our confectionery manufacturing for the future with a £29.4 million investment at our factories in York and Halifax and the proposed closure of our Fawdon site towards the end of 2023. Regrettably, these proposals put 573 roles at risk, subject to consultation. Nestlé Confectionery has an ambitious business strategy in the UK and these proposals are intended to support our long-term success in an increasingly competitive category. The proposed changes would create a more efficient manufacturing footprint and, in turn, allow greater strategic investment in Nestlé’s biggest confectionery brands. We have chosen to announce these proposals as early as possible to provide the maximum time for consultation with our colleagues and trade unions. We will make sure those affected are properly supported throughout this consultation process. The proposals we have shared with our employees today are that:

• Production at Fawdon would move to other, existing factories in the UK and Europe and Fawdon factory would close towards the end of 2023.

• We would make an £20.2 million investment at our York factory to modernise and increase production of KitKat in the city where the brand was first created in 1935.

• We would make a further £9.2 million investment at Halifax to build on its existing expertise and equip the factory to take on the largest portion of Fawdon’s current production.

"Our Fawdon factory is home to many smaller, low-growth brands and maintains a diverse and complex mix of production techniques. In contrast, our factories at York and Halifax have clearer specialisms and manufacture some of Nestlé’s biggest brands.The decision to propose Fawdon’s closure follows significant investment and a sustained effort by the factory team to reduce that complexity and introduce new products in recent years. The skilled and dedicated team at Fawdon have worked tirelessly to deliver those changes and these proposals are absolutely no reflection on their efforts.

"If these proposals go ahead, we would expect, in future, to be manufacturing a higher volume of products overall while operating a smaller number of factories. We do not underestimate the impact that the closure of Fawdon factory would have on the local area and, as part of the consultation, we want to work with the local community to find ways that we can support the area and our employees if these proposals were to go ahead. We believe these proposals would strengthen the UK’s position as a critically important hub for Nestlé Confectionery and home to the expert manufacture of many of our most popular brands including KitKat, Aero and Quality Street.

"The City of York is the proud home of our confectionery business where Nestlé has invested more than half-a-billion pounds over the last three decades. The site’s main office building, Nestlé House, is currently undergoing a £9m refurbishment. York is also the base for Nestlé Confectionery’s global R&D centre which develops products for markets all over the world. A new manufacturing line was added to the centre in 2020 as part of a £4m investment. Our Halifax factory has operated at the same site for well over a century and, under these proposals, would become even more important to our operation with an overall increase in production volumes.

"We believe that the business case behind these proposed changes is compelling and, ultimately, the best way to keep our business competitive in the long term. Nevertheless, we very much regret the uncertainty this announcement will cause our people and their families and we want to make sure they are supported throughout this process.

"There is now the time and the space for all parties to engage in a constructive consultation around today’s proposals and we welcome those discussions."