Carlo Gavazzi, the Swiss-based multinational specialising in automation components, has confirmed it will be gradually phasing out its manufacturing operations in Malta.
The company’s Maltese arm, located in the Bulebel Industrial Estate, reportedly employs around 140 people. While no exact timeline has been disclosed, the group said the restructuring will result in a “progressive reduction and eventual closure” of production in Malta.
The move will bring to an 37 years of activity on the island.
In its official statement, the Carlo Gavazzi Group assured clients that its products will remain unaffected.
“Production of the products previously manufactured in Malta will be continued at other Group locations, in particular at the plants in Mexico and China,” it continued.
The company’s products have thus far been created, developed, manufactured and tested locally. It also collaborates with the University of Malta and MCAST for its staff training and apprenticeship.
General Workers Union response
The General Workers’ Union (GWU) has reacted strongly to the news, describing the phased closure as a “serious blow” to Carlo Gavazzi’s long-serving employees in Malta.
In a meeting requested by the company, GWU officials were formally informed of the planned restructuring, which will see the Bulebel plant gradually wound down and its 140-strong workforce made redundant over the coming months. The first job losses are not expected to take place for at least seven months.
GWU Secretary-General Josef Bugeja said the union’s “absolute and immediate priority” is the welfare of affected workers and their families. He pledged that the union will “use its full strength and resources” during the consultation process to defend employees’ rights and secure the best possible compensation packages.
Alongside negotiations with the company, the GWU said it will also be engaging with the Ministry for the Economy, Malta Enterprise, and private sector employers to help facilitate alternative employment opportunities. It also entered into a 30-day consultation period with the company.
Government reacts
The Ministry for the Economy, Enterprise and Strategic Projects said it was formally informed by Carlo Gavazzi of its intention to shift production from Malta to facilities in Mexico and China as part of the group’s regionalisation strategy.
In a statement, the Ministry expressed “deep concern” about the impact on the company’s Maltese employees, emphasising that their wellbeing and future are the Government’s “immediate priority.”
Discussions have already been launched with Carlo Gavazzi and other stakeholders to ensure that all affected workers are supported, including through alternative employment opportunities and access to training where needed.
The Ministry pointed to Malta’s strong labour market, which it said continues to generate demand for skilled workers, and pledged to work with industry to align this demand with the skills of those impacted by the closure.
“The Government will maintain ongoing communication with employees and their representatives to safeguard their interests throughout this transition,” the statement read, adding that Malta remains committed to strengthening its manufacturing sector while promoting innovation, sustainability, and job creation.
Carlo Gavazzi was established in Malta in 1978 and is responsible for the ‘Switches’ product line portfolio, the research and development section of the company was established in 1998. In 2006 the group said that its Malta plant was one of its principal production locations.
Headquartered in Steinhausen, Switzerland, Carlo Gavazzi is listed on the SIX Swiss Exchange and operates globally with a strong focus on automation solutions.
Carlo Gavazzi Holding AG had flagged a significant downturn in its latest financial year, pressures that may have influenced its decision to restructure.
For the 12 months ending 31st March, the group projected revenues of around €139 million, a sharp drop from €184.28 million in the prior year.
The company noted that the steep decline was concentrated in the first half of the year, with performance stabilising somewhat in the second semester. Nevertheless, the full-year figures mark a significant contraction in both sales and profitability.
