Lear Corporation Closes Gödöllő Plant

Lear Corporation Hungary Ltd., the local subsidiary of the automotive multinational firm, announced the collective redundancies of more than 800 employees at a workers' meeting this week.

Zsolt Kozma, president of the Lear Employees' Union, told reporters that the company announcement about the layoff means the closure of the wiring loop factory in Gödöllő, east of Budapest.

According to him, the reason for the plant closure may be that the company probably considered that the labor costs of production in Hungary were now too high. Trade unions have already seen the sector in decline in recent years, with the closure of the company's 500-strong wiring loop plant in Gyöngyös just five years ago, and hundreds of redundancies at the Gödöllő unit.

The parent company has continued to open plants in countries such as Serbia, Morocco and Tunisia where it can carry out these operations at substantially lower labor costs, and it has transferred production of some products from Hungary to these sites as a group, Zsolt Kozma said.

He added that until now, it had been the case that the discontinued operations had been replaced by new ones, but now no new production is coming to Hungary because Lear can produce more cheaply and profitably in poorer countries.