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EMS firm HANZA Holding AB has decided to convert its standalone sheet metal factory in Vaasa, Finland, to a logistics and service center. The change will be part of a final phase of the acceleration program Frontrunner, which HANZA says will be completed by year-end.
HANZA’s Frontrunner program involves the transferring of selected factories to five specific strategic geographic areas—known as Production Clusters.
HANZA is now working with the last phase of the program, and has decided to relocate and discontinue the sheet metal mechanics manufacturing in Vaasa, Finland. The change will affect about 50 people.
The completion of the Frontrunner program means that HANZA, over a period of 18 months, has:
- Divested and transferred six stand-alone factories to HANZA’s Clusters
- Discontinued a sizeable amount of non-strategic manufacturing
- Executed a strategic acquisition, Metalliset, which reinforces the Cluster structure, and expands HANZA manufacturing expertise to heavy mechanics
- Broadened the ownership of HANZA to a group of industrially experienced investors
The cluster structure creates a cost efficient and flexible environment for outsourced manufacturing. It is also an important competence structure for HANZA’s service product MIG, where HANZA works consultative to analyze and rationalize customers' manufacturing chains. Improvements are achieved for customer, for example, by reducing the number of subcontractors and relocation of existing production.
“In an orderly way we have created a solid foundation for the future, with unique manufacturing Clusters and MIG-services,” says Erik Stenfors, CEO of HANZA. “We have discontinued significant parts of our non-strategic traditional manufacturing, and we will now grow with selected industries and customers in a profitable way – for us and our customers.”
During the third quarter of 2016, HANZA executed a major part of Frontrunner by transferring a stand-alone factory to Cluster Estonia, an expansion of Cluster Central Europe, and a coordination of Cluster China. Sales volumes are adversely affected by discontinued factories and phase-out of traditional customers, but at the same time the streamlining frees up vital capacity for new MIG projects.
The cost of the program is separately stated in HANZA interim reports. The financial target for the Frontrunner program is to offset the non-recurring costs, including severance pay and surplus rental costs, with a structured liquidation of surplus assets, which are freed by the cluster concept.
“We are proud to lead the transformation of the manufacturing industry, the need for new solutions is great,” says Stenfors. “We are a young company with the future on our side. As Frontrunner is completed, we are entering a new exciting phase of HANZA.”
