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Coke invests, but lays off hundreds

Coca-Cola Norge plans to lay off nearly half of all its employees in Norway next year, after it revamps its bottling operations and turns over beverage delivery to grocery wholesalers. Coca-Cola is investing heavily in the re-tooling, but as many as 500 workers will lose their jobs.

A decline in sales of Coca-Cola’s sugary soft drinks is behind much of the major restructuring that mainly affects operations at the US-based company’s large plant at Lørenskog, northeast of Oslo. The jobs of around 400-500 employees at the plant are expected to disappear by March 2013.

Preventing red ink
“We needed to tackle the situation before we start seeing red ink,” Stein Rømmerud, communications director for Coca-Cola Enterprises Norge og Sverige, told newspaper Dagens Næringsliv (DN). Increasing competition from grocery store chains’ own house brands have also contributed to the sales challenges.

Coca-Cola plans to invest NOK 600 million (USD 100 million) on the restructuring that will eliminate the current return-deposit plastic bottles now sold in Norwegian stores and replace them with disposable plastic bottles that customers can recycle. The alternative, according to Rømmerud, was to halt all production and bottling in Norway and import all beverages from lower-cost countries.

The current half-liter and 1.5-liter hard-plastic bottles that replaced glass bottles around 20 years ago in Norway will disappear. That means the return- and washing facility at Lørenskog that has handled around 300 million such bottles a year will be shut down.

New systems, new job possibilities
In its place will come new machinery that will produce thinner, recyclable bottles like those found elsewhere in the world. Customers will still have to pay a deposit on them, returnable when they’re delivered to new recycling machines being built to handle them.

Coca-Cola’s familiar red and white trucks will also disappear from Norwegian roads, with distribution to be taken over by the grocery store store chains. Rømmerud claimed that will reduce emissions, as will the new bottling process.

He said the company also expected that around half of the employees laid off would be hired by companies involved in the new delivery and recycling operations. Coca-Cola also planned to help the others find new jobs.

Views and News from Norway/Nina Berglund

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