HELSINKI: South Korean conglomerate STX's Finnish shipbuilding subsidiary said Monday it plans to cut 700 jobs by June 2014 and wind down work at one of its three shipyards.
STX Finland said it would gradually halt construction at its shipyard in the southwestern town of Rauma as part of restructuring plans designed to "assure the future of the shipbuilding industry in Finland."
The company said it planned to concentrate construction work at its shipyard in the city of Turku, about 80 kilometres or 50 miles south of Rauma.
"The Turku shipyard is capable of building all types of ships."
"The restructuring will not limit the company's supply range or reduce the volume of its operations," said STX Finland.
It said activities at Rauma "in their current form" would stop.
But did not announce the definitive closure of the shipyard, which employs about 700 people.
"We regret having to make such tough decisions that will hit the Rauma Shipyard especially hard," said STX Finland chief operating officer Jari Anttila.
But the move "will halt the company's vicious circle of losses, now in its sixth year, and lay the foundation for a profitable business," he added.
STX Finland said it was in talks with employees and would offer "concrete measures" for those affected.
The Finnish naval construction sector has seen orders decrease over the years.
Late last year, STX Finland lost a one-billion-euro or $1.3-billion contract for a cruise ship to the STX France shipyard in Saint-Nazaire.
STX's Finnish subsidiary currently employs 2,500 people at the Turku, Rauma and Helsinki shipyards. (AFP)
