VOLOS, Greece—ContiTech Imas S.A., the Greek subsidiary of ContiTech A.G., has stopped production of conveyor belts due to the continuing global economic downturn in commodity markets, particularly the lignite mining industry.
ContiTech said in a statement that a review of its manufacturing footprint and production capabilities had led to the decision to stop conveyor belt production at the Volos plant in March. About 138 employees are affected.
“All production employees left the company on March 11 while administration staff are working to close several tax and labor issues,” a ContiTech spokesman said.
The plant was a relatively small plant compared with other locations noting that ContiTech's conveyor belt business employs about 6.500 worldwide, the spokesman said. ContiTech Imas is selling off its inventory.
According to the ContiTech statement, following the closure, customers will receive service support from other under-utilized facilities throughout the company.
“Lignite mining sector, cement and steel manufacturers as well as other industrial companies are not investing as much as they did several years ago,” said Hannes Friederichsen, head of the Conveyor Belt Group business unit.
Consequently, he added, ContiTech Imas S.A. is faced with excess conveyor belt capacity.
“This was a difficult decision and was not taken lightly, but was unavoidable after months of intensive but unsuccessful negotiation,” he went on to say.
ContiTech founded its conveyor belt plant in Volos in 1972, and produced steel cord conveyor belts, fabric belts, pulley lagging and splicing material for the Greek market and for export.
The company's steel cord manufacturing plant in Greece, Syrma S.A., has not been affected by the decision.