Hasbro UK Ltd., part of U.S. toy giant Hasbro Inc., is shutting two United Kingdom plants in June, resulting in a loss of 251 jobs.
Hasbro bought the plants in December 1994 for £50 million ($80.5 million). Officials say the plants have poorer productivity and less capacity than other European units.
The Castle Gate plant near Leeds, England, employs 200 and makes board games, crafts and three-dimensional jigsaw puzzles. The Paddock Wood, England, plant employs 51, and injection molds parts for a table soccer game.
Hasbro plans to switch production to modern Hasbro plants in Waterford, Ireland, and Valencia, Spain.
Hasbro is negotiating separation packages with plant employees and trade union representatives. Some employees may move with the production, said Graeme Derby, sales and marketing general manager in Leeds.
Hasbro runs 18 injection presses at Paddock Wood, including six Italian-made Biraghi machines and some Arburg presses, with clamping forces of 25-400 tons.
Even though 60 percent of Hasbro's $900 million in European sales already come from the Valencia and Waterford factories, both have plenty of spare capacity. Eighteen months ago, Hasbro transferred production of its Monopoly game from Leeds to Waterford.
The Castle Gate plant, a converted 1914 munitions factory, began producing Monopoly in 1966. But it could only turn out 400,000 games a year, compared with the 2 million games annually produced by Waterford for Europe and other export markets, according to Hasbro.
``Sadly, it has proved impossible to manufacture competitively from a site which was not designed for the purpose. The fact is that Waterford and Valencia are modern, well-equipped plants which are underutilized and can easily absorb the capacity of Castle Gate and Paddock Wood,'' said Bryan Ellis, Hasbro UK's managing director.
Hasbro has made substantial investments to the plants now slated for closure. The firm spent £2.5 million ($4.03 million) on the Paddock Wood plant, including two new injection presses and refurbishing nine existing machines.