PMB business: Operations closed for a week amid demand decline

2008-09-25 00:00

Weakened product demand over the past two months has forced Aberdare Cables in Pietermaritzburg to shut down its operation for a week, in line with a similar move affecting the company’s operations elsewhere in South Africa.

Deputy CEO Ian Millar told The Witness yesterday that the local plant, which employs about 406 people, has been closed for the week due to a decline in cable demand — particularly within the construction industry.

However, he stressed that none of the plants is in danger of permanent closure.

“In consultation with our employees, we decided to close all our operations for the week. Many have elected to have it [the days lost] taken off their shut-down [annual] leave or have it deducted at four hours a week.”

A chief concern relates to electricity supply constraints, which negatively affect the rollout of new property development projects.

“That’s a big one [reason for the slump]. This affects everything, from a new shopping centre project to residential estates,” Millar said.

“Many customers are holding large volumes of stock as they too are seeing a decline in building activity within the local market. There are a number of reasons for the slump.”

The decline in business confidence in South Africa has also been a major issue.

In addition, higher interest rates and the ongoing impact of the National Credit Act are major factors contributing to the trend.

The Pietermaritzburg operation is a major employer within the local economy and is also well known for its corporate social investment initiatives, which benefit disadvantaged communities.

Millar, who is also executive director of Human Capital at Aberdare Cables, added that they tried to limit any negative impact on employees.

“The midweek public holiday also lent credence to this decision, given the disruptive nature of a midweek holiday.”

He added that the move has enabled them to “realign production with order off-take and stock balancing”.

“We have not had downtime for a while. We’re hoping that things do pick-up in the future,” he added.

Aberdare Cables is part of the Powertech Group and it supplies cables to companies in the construction industry, railway and transport organisations, power supply authorities, municipalities, and the industrial, petrochemical and mining sectors.

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