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Toronto glass plant closure: LCBO denies 'anti-glass' bottle policy

Post Time:Jul 30,2008Classify:Industry NewsView:345

TORONTO — An Ohio-based glass manufacturer that's shutting down a Toronto glass container plant and throwing 430 people out of work is partly blaming the Liquor Control Board of Ontario for the decision - a charge flatly rejected by the LCBO.

Owens-Illinois Inc. (NYSE:OI) blamed the Toronto plant closure, effective Sept. 30, on the high dollar, soaring energy prices and what a company spokeswoman described as an "anti-glass" container policy at the province's liquor control agency.

"Whether that's what they're trying to do, it feels to us like an anti-glass campaign," Owens-Illinois chief communications officer Carol Gee said in an interview. "It certainly feels like they're deliberate in their intent. This is not a free-market situation, in our opinion."

Gee said the liquor board is trying to squeeze glass containers off store shelves in favour of plastic containers and tetra packs - A move Gee described as a misplaced attempt to be environmentally friendly, since glass is 100 per cent recyclable.

"All the rest are wannabes," she said.

Chris Layton, a spokesman for the LCBO, said the agency would be more than willing to meet with company officials to discuss the situation, but insisted there's no evidence to suggest it is trying to reduce the number of products sold in glass containers.

"The facts just don't support that argument," Layton said. "The reality is the dominant format at the LCBO for our products is glass, and will continue to be so. We don't anticipate that trend is going to change."

Layton said non-glass containers account for less than 4.5 per cent of the LCBO's annual $4 billion in sales, and noted a good chunk of that 4.5 per cent was the sale of beer in aluminum cans instead of bottles.

Owens-Illinois, which has 24,000 employees around the world, wrote to Premier Dalton McGuinty to warn the LCBO was costing it customers, but never heard back from the Liberal government before the decision was made to close the Toronto glass plant, Gee said.

"We understand when Wal-Mart makes these kinds of decisions, but we're surprised by a Crown corporation having a point of view that's this wrong," she said.

"(The LCBO) was one of many factors; the primary factor was our global footprint realignment."

The Toronto plant's production is to be shifted to other factories, including sites in Brampton, Ont., and Montreal, the company said.

Shifting production to other North American facilities will allow Owens-Illinois to reduce costs and consume less energy "while still meeting current and anticipated market needs," Scott Murchison, president of the 24,000-employee company's North America glass containers division.

"The Canadian dollar is strong, that's hurting us. Fuel costs are hurting us. (They are) the other factors that play a role here, and the LCBO," Gee said.

Source: The Canadian PressAuthor: admin

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