Vidachim to cut staff by 150, not 314

Bulgarian-based car tyre manufacturer Vidachim has reduced the scale of planned staff cuts from 314 to 150. The new plans were announced on Monday 16 March 2015 after a meeting of Energy Minister Temenuzhka Petkova with workers and senior executives of the plant. However, it is not clear how long these measures can delay further job cuts.

At the end of last week, Vidachim informed the local employment office about layoffs of 314 workers due to the reduced production. According to the local Darik radio channel, Petkova made clear that the authorities would do their best to prevent 300 families from facing redundancy.

Petkova questioned why electricity production had been prioritised, leaving rubber items behind. She argued that the authorities had committed to stimulate the production of rubber products as this was the main activity of the plant.

Petkova pointed out that the revenues of the company in 2013 had amounted to 54 million Bulgarian Lev (£19.743 million; 27.609 million euros; US$29.219 million), including 52 million Lev from the National Electric Company (NEK).

In addition these figures were compared with Energy Ministry data that indicated that Vidachim’s total revenues for the period 2011-2013 stood at 171 million Lev (£62.497 million; 87.440 million euros; $92.515 million), including 141 million Lev from the sale of electricity.

Bulgaria’s Energy Minister said that one of the options to keep Vidachim functioning and to allow a part of the workers to keep their jobs involved including the company in the cold reserve auction of the Electricity System Operator (ESO) scheduled for the end of April.

Sevdalina Dimitrova, chair of the Board of Directors of Vidachim, explained that the power plant at Vidachim had been stopped at midnight on 12 March 2015.

She informed that state-owned electricity utility NEK owed Vidachim a total of 11 million Lev, adding that the sum had to be paid to suppliers and workers of the plant.

Dimitrova noted that NEK had transferred 2.4 million Lev to the company on Monday, thereby reducing the debt to 8.7 million Lev. She said that the tyres manufactured by Vidachim were not competitive, despite the fact that they were sold at the cost price.