Velan Inc. cutting 110 jobs as energy sector slump takes its toll
Most of the job losses will com from the company's operations in Quebec
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MONTREAL—Industrial valve-maker Velan Inc. is cutting 110 workers and consolidating production into one of its two Montreal plants.
The company says the economic downturn, specifically in the energy sector, has created uncertainty and hit its order books.
“The layoffs were necessary as the result of an economic downturn that is impacting some of our important markets, especially the energy markets where the falling price of oil and the state of the global economy are creating uncertainty and affecting our bookings,” said Yves Leduc, President of Velan, “Against tough global competition, we need to become a more agile organization with a leaner cost structure. Meanwhile, in the weeks ahead, the company and its management team will introduce a series of strategic initiatives designed to revitalize our growth and improve our operational performance.”
Velan’s employee reduction will come through a combination of temporary layoffs and elimination of certain positions in its North American facilities.
Approximately half of the employees being released are in unionized jobs and the other half are management and staff. About 75 per cent are in Montreal, 20 per cent in Granby, Que. and the remainder in Williston, Vt.
The move will reduce the Velan’s global manpower by about five per cent.
The production transfer process from the Ward Avenue building—the oldest Velan plant, dating back to 1956—will be phased in over a period of nine to 12 months.
It is anticipated that the overall estimated cost of the production transfer and the workforce reduction will be about US$2.5 million.
Founded in Montreal in 1950, Velan Inc. manufactures industrial valves, with sales of US$456 million in 2014. It has manufacturing plants in 10 countries.