BRUSSELS—Temporary layoffs and a 30 percent cut in management pay are two of Recticel's responses to the coronavirus outbreak at its plants in Europe.
"Our number one priority is the health and well-being of all our employees," company CEO Olivier Chapelle said. "As the pandemic is causing extraordinary challenges to all of us, we are taking all necessary precautionary measures to protect our employees and our business. I remain confident that we shall overcome today's crisis without compromising our long-term strategy of sustainable development."
As automotive activities in China were returning to normal at the end of March, Recticel took steps to temporarily close European business in the wake of the rapid spread of COVID-19 across the continent.
Most European OEMs have closed their plants.
In other business segments, demand is falling rapidly as countries impose lockdowns. Recticel is reacting by cutting production or closing sites temporarily.
Workers were laid off temporarily and management took a 30 percent pay cut "as a token of solidarity."
Also, in an effort to help manage cashflow, non-essential expenditures were put on hold and capital projects have halted.
Recticel said it has good liquidity, with $165 million of credit, which can be accessed quickly if needed. It also has a factoring program, which allows it to convert debts into cash and a number of credit lines.