Sklo Bohemia glassworks closing down

Czech glass maker Sklo Bohemia in Svetla nad Sazavou, eastern Bohemia, will wind up production, Sklo Bohemia staff told CTK after meeting the company's managers Monday.

The managers told most of the staff not to come to work on Tuesday. Only a few people should come to the plant to ensure that production ends.

All 1,250 staff employed in Sklo Bohemia will be dismissed in October. The plant is a unit of the debt-ridden Bohemia Crystalex Trading (BCT) group.

Sklo Bohemia stopped operation of one of its production lines for two months in summer this year because of falling crystal sales, but did not sack any staff.

On Thursday last week, Sklo Bohemia started to reduce production of lead crystal.

Staff at another BCT unit, Sklarny Bohemia in Podebrady, central Bohemia, are also uncertain about the future of the company.

Sklarny Bohemia is considered to be at the biggest risk of closure, together with Sklo Bohemia. The company has been gradually reducing production since Tuesday last week.

"Only around 30 staff needed to secure the plant's basic operation go to work now, I have sent the rest on a holiday," said Sklarny Bohemia head Jaroslav Seifert.

"We don't know any other details and are waiting for a decision from the management," Seifert added.

Sklarny Bohemia with more than 500 staff in one of the largest employers in the Nymburk district in central Bohemia.

BCT is one of the ten largest glass companies in the world, employing more than 5,000 people. The group realised orders worth more than Kc5.5bn in 2007.

The largest company in the group is Crystalex Novy Bor. The group also comprises glass makers Sklarny Kavalier Sazava, Sklo Bohemia Svetla nad Sazavou and Sklarny Bohemia Podebrady.

Petr Sklenar, economist of financial group Atlantik, said the main reason for the fall of the BCT and Porcela Plus group of glass makers was focus on production with low value added, where there is strong competition from countries with cheaper labour force.

The group has been balancing on the verge of a collapse for a long time and it was only a matter of time when it would fall, said Sklenar. The concern had too many problems, above all unresolved loans from the late 1990s.

The financial crisis was not the main cause of the collapse, but made it faster, analysts said.