Glass packagers face job losses as alcohol ban continues

post-title

Consol CEO says the alcohol industry has far-reaching consequences for jobs and revenue.

Consol chief executive officer Mike Arnold says South Africa’s glass packaging industry could see both job losses and the loss of most parts of its supply chain if the alcohol ban lasts for much longer.

Alcohol sales were recently banned for the third time as part of efforts to reduce the number of alcohol-related trauma patients needing care in over-burdened hospitals.

The first two bans resulted in losses of more than R1.5 billion to the glass packaging industry, and the industry stands to lose a further R1.5 billion in sales if the latest ban on alcohol sales continues says Mike.

A supplier of wine, spirits and beer bottles, Consol is spending R8 million a day to keep production and furnaces running in the face of declining orders.

Consol has had to reallocate R800 million from rebuilding and maintaining its current furnace capacity towards sustaining operations during the lockdown. As a result, it will not be able to fund the repair of furnaces reaching end of asset life, even if there is an upswing of glass demand.

Consol customer South African Breweries cancelled R2.5 billion of investment earmarked for 2021.  Similar decisions by other customers could see job losses and an adverse effect on sales volumes, capital expenditure and the general financial stability of the business and supply chain.  

Related articles

Top