Pembridge, UK - Kingspan Insulation is to cut up to 64 jobs at its Pembridge, Herefordshire, site in the UK, to enable it to cope with the current downturn in the UK housing market.
According to Kingspan's 25 June statement, "the current economic downturn … has hit the housing industry particularly hard." Currently "the number of new houses being built is down by around 50 percent from the start of the year, and it is predicted that next year will see a 20 percent drop."
Kingspan Insulation points out that, as a major supplier to this sector, it has "experienced a noticeable decline in trade from the start of the year."
The group emphasises that the business is strong, but that additional pressures from rising costs mean "steps must be taken to manage and minimise the impact of the current market trend."
Announcing that the workforce at Kingspan's Pembridge facility in Herefordshire is to be reduced by up to 64 people, the group said it aims to keep this number to a minimum, in consultation with the relevant unions.
Kingspan also stressed that the current slowdown is a relatively short-term market-based problem: "recovery from these difficulties is expected within the next 18 to 24 months."
In the group's Offsite business, it is closing a site making timber-framed housing, in Tredegar, Wales, with the loss of 35 jobs. The company has excess capacity at other UK sites for these products.
Kingspan had warned in May that the tougher economic climate in the UK would result in "measures aimed at reducing overheads to meet the tightening environment," including some plant closures and headcount reductions in the UK and Irish Offsite businesses.
But the building supplies group also said sales of insulation boards and insulated panels were holding up in central and eastern Europe, in a statement ahead of its 15 May annual general meeting. In the early months of 2008, flat sales of insulated panels masked a 17 percent decline in the UK and Ireland, "broadly offset by strong growth in CEE and other markets," said Kingspan. Insulation boards achieved a modest increase in sales: a drop of 8 percent in the Irish market was offset by continuing growth in the UK and the rest of Europe.