Employees at Bowater Mersey Paper Company Ltd. in Brooklyn, Queens Co. learned today (Dec. 1) the AbitibiBowater Inc. newsprint mill would be shutdown for five weeks starting four days before Christmas.
According to a “Notice” sent to employees from Bruce Nunn, Vice President and Resident Manager, “This downtime is required due to a drop in newsprint consumption and higher manufacturing costs.”
The “production downtime,” as it is termed, runs from Dec. 21 until Jan. 26, 2009.
Nunn wrote the shutdown is “part of AbitibiBowater’s announced downtime of 90,000 tons of newsprint in the fourth quarter of 2008 and 150,000 tons in the first quarter of 2009.”
He added planning for an “orderly shutdown” has started and some limited requirements for manning will be identified and relayed to employees as they are finalized. “Information to help employees apply for EI benefits is being assembled now and will be distributed shortly.”
He continued. “Mersey has been fortunate to avoid downtime to this point; however, the current global economic conditions are now affecting our operation.”
He went on to thank the employees for their work in improving the operation. “I’m particularly proud of our improved safety participation and running all year without a lost-time injury, the implementation of the Mersey Renewal Plan, and the new markets we’ve developed for book paper.”
On Nov. 6, AbitibiBowater Inc. reported a net loss for the third quarter of 2008 of $302-million, or $5.23 per diluted share, on sales of $1.7 billion, compared with a net loss of $142-million, or $4.75 per diluted share, on sales of $815-million for the third quarter of 2007, which consisted only of Bowater Inc.
Abitibi and Bowater merged about one year ago and the stock price has subsequently plummeted as well.
Over the past year, the company has been hit at various times with high-energy costs, a once high Canadian dollar, and now a probably global recession, one that is already hitting North America hard. About 50 Brooklyn plant positions were lost since the merger with some retirement packages funded by the employees themselves.
Communications, Energy and Paperworkers Union of Canada Local 141 President, Courtney Wentzell wasn’t available for comment. No company executives were available as well at this publication time.
Two employees, who wish to remain anonymous for job reasons, claim the Brooklyn plant has been earning money since the dollar dropped so drastically and that the plant cannot keep up with orders. Therefore, they said they are confused about the shutdown but mentioned union negotiations begin next May.