Zywiec Group to close two breweries and extend layoffs

The Zywiec Group, consisting of Zywiec, Lezajsk, Warka and EB breweries, plans to close its production plants in Gdansk and Lancut. Almost 400 employees have already been laid off this year, and a further 300 jobs will be eliminated in 2001. Company officials says that terms of workforce reduction will be negotiated with the trade unions and it is quite likely that Zywiec major shareholder Heineken will offer a zl. 20 million total severance package. According to Zywiec Group corporate director Krzysztof Rut, "The decision was the result of two factors: rising prices of ingredients and falling profitability of the smaller branch breweries. Meanwhile the government has announced another increase in excise duty. In these kinds of circumstances improved efficiency can be achieved mainly by cost reductions and optimization of production power." In the first ten months of this year, the Zywiec Group sold about 6.65 million hectoliters of beer, 10% less than in 1999. (Puls Biznesu, p.8)