Finland-based label manufacturer UPM Raflatac announced it will close one of its two factories in Germany to ‘improve efficiency and productivity’.
The affected facility is located in Kaltenkirchen, a town between the northern German cities of Hamburg and Kiel. It produces self-adhesive filmic labelstock and graphics material since its opening in 1982. The closure will be see 154 employees lose their jobs.
UPM Raflatac took over the Kaltenkirchen site, alongside the other German factory in Hagenow, with its acquisition of coating specialist Advanced Methods of Coating (AMC) in 2022. The acquisition added a brand for pressure-sensitive label materials called Intercoat to UPM Raflatac’s portfolio. The label solutions are suitable for household products, food packaging and oil cans as well as household chemicals.
At the time of the acquisition, UPM Raflatac said the transaction would strengthen its position in Central Europe. In June 2023 the company said its expectations for the merger had been ‘exceeded’, giving it reason to ‘look to the future with great optimism’.
Now, UPM Raflatac said the Kaltenkirchen factory will be closed down in stages during 2025. The label material production will be transferred to UPM Raflatac’s factories in Poland and Finland. The production of graphics solutions will be transferred to UPM Raflatac’s factory in Belgium once dedicated machinery is moved to the new location sometime in 2025.
“The aim of these changes is to accelerate our growth in the Films and Graphics business by improving the overall profitability of our operations and maximising synergies,” said Tim Kirchen, Executive Vice President at UPM Raflatac. “By centralising the production to more cost competitive factories, we will also improve the cost efficiency and quality of our products and will be able provide better service to our customers.”
Industry in Germany has been struggling to remain competitive amid high energy prices, lack of skilled labour, and a weakened economy. In the plastics industry, UPM Raflatac joins Sumitomo (SHI) Demag, Evonik and Kiefel in announcing job cuts in Germany. Epsotech, Illig, Kautex, and Heubach have entered self-administration.