Nestlé is planning to cut almost 600 jobs in the UK, close a factory and switch production of some products to Europe.
The Swiss-owned confectioner said it was considering closing its site in Fawdon, Newcastle upon Tyne, in late 2023, with the loss of about 475 jobs, with a further 98 to go in York.
It is proposing changes to adapt its confectionery manufacturing for the future, with a £29.4m investment at its factories in York and Halifax.
The company said: “Nestlé Confectionery has an ambitious business strategy in the UK and these proposals are intended to support our long-term success in an increasingly competitive category. The proposed changes would create a more efficient manufacturing footprint and, in turn, allow greater strategic investment in Nestlé’s biggest confectionery brands.
“We have chosen to announce these proposals as early as possible to provide the maximum time for consultation with our colleagues and trade unions.”
The GMB trade union said it was “sickening” that lives were being “ruined in a ruthless pursuit of profits”.
The Fawdon factory, which opened in 1958, makes products including Fruit Pastilles, while the York site manufactures KitKats.
Nestlé, which employs 8,000 workers in the UK, wants to move production from Fawdon to other factories in the UK and Europe.
The company said it would make sure those affected were “properly supported” throughout a consultation process.
The proposals include a £20m investment at the York factory to modernise and increase production of KitKat, where the brand was created in 1935, and a £9m investment at Halifax to take on the largest portion of Fawdon’s production.
Nestlé said: “The decision to propose Fawdon’s closure follows significant investment and a sustained effort by the factory team to reduce that complexity and introduce new products in recent years. The skilled and dedicated team at Fawdon have worked tirelessly to deliver those changes and these proposals are absolutely no reflection on their efforts.
“If these proposals go ahead, we would expect, in future, to be manufacturing a higher volume of products overall while operating a smaller number of factories. We do not underestimate the impact that the closure of the Fawdon factory would have on the local area and, as part of the consultation, we want to work with the local community to find ways that we can support the area and our employees if these proposals were to go ahead.”
The GMB national officer, Ross Murdoch, said: “To ruin hundreds of lives in a ruthless pursuit of profits, to the very workers who have kept the company going during a global pandemic, is sickening.
“Nestlé is the largest food producer in the world, with astronomical profits. It can afford to treat workers right. Instead, they have allowed factories to deteriorate, outsourced production overseas and now slash almost 600 jobs.”