IBM: Gradual Redundancies at the Vác Plant

The layoffs at IBM's Vác plant (north of Budapest) will be carried out gradually in consultation with the works council and the union until the end of production activities, scheduled for the first quarter of 2024; production will be transferred to Mexico, and some of the Vác employees will be transferred to other IBM units, the company told MTI on Tuesday.

The company said it is constantly reviewing the most efficient way to manufacture its products, and the proposed relocation of production is the result of this. At the same time, the company stressed that it remains committed to its customers in Hungary and is focused on increasing its sales there.

They also said that the closure of the plant had been communicated in a timely manner to employees and affected suppliers, landlords, local and other relevant authorities.

According to the company, a large part of the IBM Storage product portfolio is already manufactured in the Central American country, so they already have most of the necessary manufacturing expertise.

According to publicly available company information, the IBM factory in Vác employed 448 people at the end of 2022. The company said in a statement to MTI that some of the employees will be transferred to other IBM units to work from home, but did not provide exact figures.

It was pointed out that IBM still has a significant presence in Hungary after the closure of the Vác production base. They have recently opened a new office in Budapest. The IBM Shared Service Center provides high value-added services to support the company's global operations in the areas of cognitive business processes, HR, finance, procurement, administration, digitalization and IT development. IBM started its operations in 1996 in Vác, in a factory building leased from Zollner Electronic Ltd., where it manufactured high-capacity back-up storage for the global market.