IDA in talks to save 1000 Dell Jobs

iguana

Article in SBP saying that the IDA are negotiating with Dell to try and keep 1000 higher end research and customer service jobs in Limerick after Dell move manufacturing to Poland. The government has approved a large grant in order to tempt Dell. Neither the IDA or Dell have made any statement yet.

Reading between the lines it looks like Dell will be moving all manufacturing to Lodz, hopefully over the next few years rather than in one sudden lay off. This will mean several thousand job losses in the city and many companies which rely on Dell money will go out of business.

I think pretty much everyone knew this would come at some point, and while this doesn't mean they are leaving immediately it is a signal that the government believes they will be moving relatively soon and are hoping to save what jobs they can.

ninty9er

I wouldn't worry too much about it... there's only so much manufacturing Dell would consider moving considering Limerick is still their most productive plant worldwide. There's also the issue of corporation tax working against the Poles....the more profit they make there, ther more screwed they get on tax, so it's in Dell's best interests to keep profits at a stable level there.

iguana wrote: »

This will mean several thousand job losses in the city and many companies which rely on Dell money will go out of business.
.

To an extent, that's the Irish mentality taking hold.....97.9% of the workforce are employed in these small companies, so I'm sure they can create a business cycle between themselves. A lot of Dell redundancies will go into setting up spinoff companies. Many of the people working there for 10 or more years will have picked up a lot of expertise in hardware and make a go of it.

For example...an Irish company runs all the timetabling systems ( arrival & departure boards) at EVERY Disney cinema worldwide, the New York Subway, Charles DeGualle airport. We have lots of expertise in this country and I welcome stories like you have linked more than dread them because the less dependent we become on multi-nationals the further we go towards creating a stronger economy.

All that said, Dell know what side their bread is buttered on and they rely heavily on our corporation tax rate, an option which isn't and won't be open to them in Poland any time soon

1huge1

ninty9er wrote: »

I wouldn't worry too much about it... there's only so much manufacturing Dell would consider moving considering Limerick is still their most productive plant worldwide. There's also the issue of corporation tax working against the Poles....the more profit they make there, ther more screwed they get on tax, so it's in Dell's best interests to keep profits at a stable level there.

Ya I agree there is still a lot of reason for Dell to stay in Limerick.

Placid Casual

a mate of mine just took redundancy from dell, things are not looking good he said

canned

people will say that if they take redundancy..

"I'm pure smart cos I got out" attitude.

I'm not saying they're wrong but it's not the greatest source. Reality is that Dell is essentially assembly not manufacturing. this means the skills are not hard to replicate if there is another location available at a lower price.

Fact - somewhere will always raise world wide dell manufacturing's capitalist eyebrow to say "we can do it cheaper here there or anywhere"

Amazotheamazing

According to the Post, this move isn't about saving jobs, it's about creating new R&D jobs. 1000 R&D jobs doesn't sound like a complete bad news story to me.

iguana

Amazotheamazing wrote: »

According to the Post, this move isn't about saving jobs, it's about creating new R&D jobs. 1000 R&D jobs doesn't sound like a complete bad news story to me.

Yes but the reason they are trying to create these jobs and it's customer service as well as R&D is because the manufacturing side is very likely to be leaving Limerick.

The points about lower corporation have certainly been a big factor in Dell coming to and staying in Ireland, but FIGS (France, Italy, Germany and Spain) are making moves to end Ireland's ability to charge such low corporation tax, as we do so at a tax cost to them. At the moment they are unable to do so but the fact that they can't stop Ireland from doing it also means they can't stop other countries from doing so either. For example Bulgaria recently introduced a very similar 10% corporation tax.

Dell are on the record as saying the Limerick operation is "Medium Cost". They have also, recently, made very clear statements that costs in Ireland are a concern for them. On top of that the recently completed Dell manufacturing facility in Lodz, Poland has the same capacity as all the EMFs in Limerick. And it is currently only staffed by 400 workers. Most likely Dell will piece by piece transfer contracts to Lodz and wind Limerick down. In fact they have recently announced that all eastern European contracts will be manufactured from there in the near future.

Amazotheamazing

True, but manufacturing jobs are mostly contract jobs now anyway. R&D would be better paid and more secure.

1huge1

Wasn't Motorola in Cork R&D?

ninty9er

France, Can't stop us having a low tax rate, but I believe they have already stopped other countries introducing low corporation tax rates...I'll check that out though.

they can go screw themselves....the EU has always bent over backwards to accomodate Ireland becasue it knows it's the only country where the people get the final say on all the major stuff :D