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Mondelēz to axe 454 jobs in Montreal cookie plant closure

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By Oliver Nieburg+

01-Dec-2016
Last updated on 01-Dec-2016 at 17:34 GMT2016-12-01T17:34:22Z

95% of biscuits capacity at Montreal factory will move to other Mondelēz plants in Canada. ©iStock/DanielBendjy
95% of biscuits capacity at Montreal factory will move to other Mondelēz plants in Canada. ©iStock/DanielBendjy

Oreo maker Mondelēz International has announced plans to close its factory in Montreal, Canada, by the end of 2017.

The closure will result in 454 job losses.

“This is a difficult but necessary decision, which has been made after careful review of our overall Canadian supply chain and opportunities to drive greater effectiveness and efficiency,” said Olivier Bouret, vice president, Integrated Supply Chain, North America Biscuits, at Mondelēz.

The majority (95%) of cookie and crackers capacity at the Montreal plant will shift other Canadian facilities with remainder to be moved to the US.

Restructuring plan

In 2013, Mondelēz closed its 625,000 square-foot Lakeshore Bakery in the West End of Toronto -  leading to 550 job losses - and shifted capacity to the Montreal plant and another in East York.

The company has since constructed the world’s largest cookie plant in Monterrey, Mexico, in a $350m investment.

Earlier this year, Mondelēz shifted Oreo production from Chicago to the Mexican site. The move saw the company cut half of its 1,200 workforce at the Chicago factory.

Mondelēz has been restructuring its manufacturing network since 2013, closing smaller sub-scale facilities and moving production to larger multi-purpose sites.

Mondelēz number 3 in Canada’s confectionery market

Mondelēz Canada employs around 3,000 people across manufacturing plants sales and distribution centers and the company’s head office in Mississauga, Ontario.

Biscuits, including brands such as Oreo and Chips Ahoy!, make up 53% of the Canadian subsidiary’s annual revenues. The rest comes from confectionery products including gum, chocolate and candy brands like Cadbury and Trident.

Mondelēz was the third biggest player by revenue in Canada’s confectionery market with a 13% market share in 2015, according to Euromonitor. Nestlé Canada led the market with a 15% share, followed by Hershey Canada on 14%

Total Canadian confectionery sales were up 5% in value and 2% in volume last year to reach CAD 3bn ($2.2bn) and 123,500 metric tons, according to the market research organization.

Bouret said Mondelēz remains committed to manufacturing Canada and will continue to operate five production facilities and two distribution centers as well as its Mississauga office.

[Background reading from 2013....Wrecking ball for Mondelez's older sites as supply chain overhaul planned ]

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