At its height, Waterford Crystal employed 3,200 people in Waterford, at its Kilbarry and Dungarvan plants. The world-renowned brand traces its lineage to a factory opened in the city in 1783, although that business failed in the 1850s.
Waterford Crystal was revived by Czech immigrant Miroslav Havel in 1947 and went on to become the city’s largest employer in the 1980s. The Kilbarry factory remains one of Ireland’s top tourist attractions, with an estimated 300,000 visitors annually. Waterford Wedgwood, founded following the 1986 merger of Waterford Crystal and Wedgwood, went on to acquire such luxury brands as Rosenthal and Royal Doulton,
The Crystal business thrived in the 1990s but changing consumer tastes, cheaper competition from aboard and the weak US dollar all took their toll in the years following the Millennium. The war in Iraq had a massive impact on the luxury goods markets, especially in the United States, one of the Waterford brand’s major markets. As virtually all of its production costs were in euro and sterling, the company found itself in ever direr financial straits and much of the business shifted offshore.
In the years 2004 – 2007, total losses at Wedgwood were a massive €480m and one of the major casualties of these losses was the closure of Waterford Crystal’s Dungarvan plant in May 2005. The group also unveiled major job cuts at Royal Doulton and Rosenthal at the same time. Between them, these cutbacks reduced WW’s total headcount by 2,200 and cut costs by €90m a year.
However the group continued to battle. A range of measures were taken to boost flagging sales, particularly in the US. Newer ranges, by designers like John Rocha, Marc Jacobs, Robert Mondavi and Jasper Conran, were introduced in a bid to appeal to a younger market and Crystal sales did increase in 2006. A series of rights issues raised approximately €300m, most of which were funded by WW chairman Sir Anthony O’Reilly and deputy chairman Peter Goulandris, and there was optimism that the fate of the group had turned around. However this was not to be, with the ability to produce profitably in Ireland shattered by rising competition, particularly in Eastern Europe.
Much of the business has now shifted offshore, where Wedgwood employs 5,800 people, including 1,500 people at a plant in Jakarta, Indonesia, which produces most of the company’s ceramics. The majority of its Crystal production has been handed to Eastern European subcontractors, notably Steklarna Rogaska d.d., a glass manufacturer based in Rogaska Slatina, Slovenia. Much of production from the Dungarvan plant moved to Brazil.
The company has been mulling whether to reduce the Waterford operation to a tourism-only site since at May 2008, when the Irish government rejected its appeal for emergency assistance.
Timeline of job losses
* In November 2001 Waterford Wedgwood announced plans to cut 1,400 staff, including 100 in Waterford, as the company struggled in the face of falling demand for its china and crystal since the September 11 attacks in the US.
* In July 2003, the company confirmed that it was to shed 234 jobs and introduce an immediate pay freeze. Voluntary redundancies were sought from 105 permanent staff and the contracts of a further 129 workers were not renewed.
This €18m cost-cutting package came about because the company said it was unable to undertake wage increases promised under the national pay agreement. Weak US sales and a slump in tourists visiting the company’s flagship plant in Kilbarry were blamed for the decision.
The previous month, the group closed two UK factories with 1,058 job losses in a bid to cut costs. Production was moved to China, where the company said overheads were more than 70% lower. John Foley, then CEO of Waterford Crystal, said at the time that the company could source nearly 50% of product at up to 30% less than they had been able to produce it in the Irish plants. Outsourcing to low-cost Eastern European countries was therefore amongst the cost-cutting measures implemented by the company.
* In May 2005, the company announced its intention to close its 30-year-old Dungarvan factory. This would herald the loss of 390 jobs in Dungarvan, with a further 95 employees facing redundancy at Kilbarry. Production was moved to Brazil.
* In November 2007, Waterford Crystal confirmed that it planned to cut 490 jobs at the Kilbarry plant.
The company said at the time that manufacturing capacity at Kilbarry was uncompetitive due to a combination of high costs and currency movements. Plans were made to outsource production and some administrative and ‘back-office’ operations.
A company spokesperson said Crystal would stop manufacturing loss-making lines at Kilbarry and concentrate on producing high-quality, cost-competitive products, claiming that this would safeguard 510 jobs in Ireland ‘for now’.
* In October last, Waterford Crystal told workers about its plans to lay off another 280 people at Kilbarry, ending large-scale manufacturing at the plant. This would reduce the numbers working at the plant to approximately 200, news that was greeted with dismay and anger by workers.
This plan involved the retention of some 70 jobs in production, a further 55 in the visitor centre and 70 jobs in administration and maintenance.
The company told employees it intended to maintain production in Waterford “making a range of prestige hand-crafted crystal products, its tourist trail and its gallery operation”, while also remaining “committed to the retention of its intellectual property in Ireland”.