Kährs to cut capacities at all its European flooring factories, affecting 175 workers, citing drop in demand; 100 employees at its Nybro, Sweden, site have been given notice, in addition to 25 temporary workers who left at end of 2022

Sample article from our Wood & Building Products

MALMO, Sweden , January 13, 2023 (press release) –

Kährs adjusts its capacity to meet a lower demand for flooring solutions in the residential segment in 2023, both in renovation and new built. The market is highly affected by increased interest rates and a high inflation, especially in Europe, contributing to a clear drop in market demand from record levels and high orderbooks in 2022.

Low consumer confidence is creating challenges in demand in Europe moving forward. Higher prices, on energy in particular, continue to be a big challenge. Combined with a general rise in inflation and the risk of continuing rising interest rates and falling house prices. Kährs is preparing and adapting its operations with a focus on cost control and capacity adjustments to ensure continued low debt and a strong cash flow.

To adjust capacities and to mitigate the effects of lower demand in 2023, Kährs implements a plan to lower the capacities in all its European factories in steps, affecting a total of 175 coworkers.

In the Swedish production site in Nybro, Kährs has announced a notice of 100 employees, 95 blue-collar positions and 5 white-collar, in addition to 25 temporary employees that left during the later part of 2022. Negotiations with union parties have been initiated. Affected employees will receive information during the first quarter 2023 and the redundancies will start to take effect from 1 April.

"It is always extremely sad to have to part from good and loyal employees. But we must adapt our production to the prevailing conditions to be a sustainable and profitable business over time. We will work to find good solutions together with our union negotiating partners", says Carl-Henrik Stenermark COO at Kährs Group and site manager in Nybro.

Despite the downturn, President & CEO Johan Magnusson sees a great need for the company's products and services in the future.

"Households are still increasing their focus on the home and their immediate surroundings as well as the possibility to work from home, which is creating possibilities. In the long term, we continue to be optimistic with more of a focus on both sustainable buildings and quality housing as well as demand for flooring products with good wood design. There is a great need for renovation and more new buildings in the long term. We will continue to build Kährs in order to be well equipped to help our customers in the best way in the future as well as to make Kährs an even better workplace", says Johan Magnusson.

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Dan Rivard
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