The company is planning to discontinue machining and sheet metal operations in Winterthur, Switzerland, develop a concept for future land use at the Winterthur site and cut jobs at the facility by around 150 full time workers.

The manufacturer says these measures will allow it to focus on the assembly of machinery in Winterthur and reduce costs.

Plans to streamline production

In March this year, Rieter also announced that it intends to streamline production in Winterthur, Switzerland, and reduce the amount of purchases in Swiss Francs. Both measures are being introduced in response to the changed business environment, the company reports.

The proposed concept for the streamlining of production provides the company with an opportunity to concentrate on the assembly of machinery in Winterthur and thus to discontinue machining and sheet metal operations there. The corresponding discontinued production is to be taken over by other Rieter sites and suppliers, while the remaining production is to be realized in a single building.

With the implementation of the two measures, the manufacturer expects to achieve a cost reduction of CHF 15-20 million by 2017.

Future land use

In addition, Rieter has started to develop a concept for future land use at the Winterthur site. The proposed concept entails a reduction of around 150 full time workers at the Winterthur site. Moreover, there are to be 59 fewer temporary positions. The number of people employed by Rieter in Winterthur totalled 855 at the end of September.

Rieter expects to minimize the number of potential layoffs through early retirement and fluctuation. The company has a social plan in place for potentially laid-off employees; and the consultation process with the employee representatives started this week.

Demand for after-sales services

The company has also recorded a great demand for after-sales services and components, whilst market for new machinery still at low level. At the end of September 2015, Rieter posted cumulative order intake of CHF 587.1 million.

The CHF 68.2 million for orders received by the Components business group in the third quarter is especially pleasing, the company reports. Also, the demand dynamics in the After Sales business group were favourable in the third quarter with order intake amounting to CHF 32.3 million.

The low demand for new machinery in the third quarter resulted in order intake totalling CHF 98.3 million at the Machines & Systems business group.

www.rieter.com