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Glass plant closes; LCBO cited

Post Time:Aug 07,2008Classify:Company NewsView:364

U.S.-based Owens-Illinois Inc. has announced the shut down of its glass container plant in Toronto. The closing will occur in September. The company has blamed the Liquor Control Board of Ontario (LCBO) partly for the loss of 430 jobs at the plant.

The company, based in Perrysburg, Ohio, is the world's leading manufacturer of glass containers, with 82 manufacturing plants, including two in Ontario. Owens-Illinois says its plants in Brampton and the Toronto suburb of Etobicoke generated US $200-million (U.S.) in sales last year, employed 745 in well-paid manufacturing jobs and produced glass containers for several beverage and food companies, including Andres Wines, E.D. Smith, Bacardi and Hiram Walker.

In a news release, Owens-Illinois cites a number of reasons for closing the plant in Etobicoke, including the strong Canadian dollar, high energy prices and "recent activities" of the LCBO.

In a letter dated July 2 to Ontario Premier Dalton McGuinty, Owens-Illinois chairman and chief executive officer Albert Stroucken accuses the LCBO of launching an "unprecedented, ongoing attack on our business."

Mr. Stroucken says in the letter that the LCBO has been "aggressively encouraging -- and in some cases effectively forcing -- our customers in Ontario and in other jurisdictions to switch from using glass packaging to so-called 'alternative' materials such as plastic and aseptic cartons."

According to a story in the Globe & Mail newspaper, Chris Layton, a spokesman for the LCBO, denied in an interview that it is using its monopoly as the sole distributor of spirits and the biggest distributor of wines in the province to force companies to package their products in alternatives to glass, such as plastic and Tetrapak containers.

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.

Source: Owens-Illinois Inc.Author: admin

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