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GEA To Discontinue Production At Bodenheim, Germany; Invest In Site Expansion In Poland

German Technology company GEA Group AG (GEAGF.PK,GEAGY.PK) said that it will discontinue production at the Bodenheim site near Mainz, Germany by the end of 2024.
Meanwhile, the company said that the plant in Koszalin, Poland, will be expanded into a Center of Competence for pump production and comprehensive machining. It will invest around 30 million euros in the expansion.

The company is planning to invest and a further consolidate production at other locations, too.

As part of the new production strategy, about 150,000 production hours are to be transferred from Germany to GEA's Polish site in Koszalin between 2022 and 2024. In this context, the Koszalin site will be significantly expanded.

Around 90,000 production hours, which are currently performed by external providers, will gradually be implemented in Koszalin from 2021. The relocation of production hours to Poland is expected to lead to a reduction of around 160 jobs in Germany by the end of 2024. Around 60 of these are planned to be reduced through natural fluctuation and partial retirement solutions.

As part of the site consolidation, the company plans to close down pump production at the Bodenheim site near Mainz with its around 90 production employees by the end of 2024. The remaining functions located there, such as R&D, are not affected. GEA aims to reduce its workforce without any compulsory redundancies.

In addition to Koszalin, the new production strategy defines eight further Centers of Competence. Of GEA's 26 German sites, four - Berlin, Bönen, Büchen, and Oelde - will also be extended to Centers of Competence, along with the Italian factories in Parma, Colognola and Manfredonia as well as the plant in Tianjin, China. Investments for expanding these sites as part of the production strategy are planned, too.

GEA plans to add additional Centers of Competence in the future. All investments will take place within the scope of the existing financial planning framework and will neither impact the outlook for 2020 nor GEA's medium-term targets.

Meanwhile, GEA has already relocated around 40,000 production hours from Chateau-Thierry in France to Tianjin in China. The transfer of a further 120,000 production hours within China by consolidating the Shanghai plant with Suzhou will be completed by the end of this year. The current productivity initiative and associated investments in digitalization and automation are expected to increase productivity and reduce overall costs.

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