- Plans to reduce European costs by €100 million per year starting 2016.
- Expanding North American trona mining operations by 12% in Green River, Wyoming.
- Closing soda ash unit in Povoa, Portugal by January 2014.
- Restructuring measures to affect about 450 job positions by 2016.
Cost Reduction and Profitability
Solvay plans to reduce its European cost base by €100 million per year starting in 2016 to improve long-term profitability. This initiative focuses on enhancing the competitiveness of its synthetic soda ash plants in Europe and expanding trona mining operations in North America.
Market Dynamics and Overcapacity
Solvay has developed an action plan to address varying regional market dynamics for soda ash. While global demand grows at GDP rates, European demand has declined due to economic downturns, leading to structural overcapacity.
North American Expansion
In North America, Solvay is expanding its production capacity by about 12% at its Green River, Wyoming site, which operates best-in-class trona-mining industrial assets. This expansion requires limited investments.
European Transformation
Solvay will implement a transformation program at its six main European soda ash plants to improve synthetic soda ash production and maintain cost leadership. The program includes raw material and energy efficiencies, maintenance excellence, and organizational redesign.
Plant Closures and Job Impact
To address overcapacity, Solvay will close its soda ash unit in Povoa, Portugal, by January 2014 and adjust production in Rosignano, Italy, based on market needs. The restructuring measures will affect about 450 job positions by 2016, with efforts to prioritize relocations within European sites.
Expected Outcomes
These measures aim to enhance Solvay’s soda ash European cost base by €100 million per year from 2016, with profitability improvements starting in 2014. The optimized production network will better serve local and global clients.
