The sites will be shut down by the end of Q2 2024. Credit: T. Schneider via Shutterstock.

Huhtamaki, a sustainable packaging solutions provider, has announced plans to consolidate its production footprint within the fibre foodservice Europe-Asia-Oceania segment in China. 

As part of this move, the company will shut down its Tianjin and Shanghai production sites in the country by the end of the second quarter (Q2) of 2024. 

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Huhtamaki is transferring these operations to its Guangzhou-based manufacturing site.  

The restructuring will not affect production at its site in Xuzhou, according to the company. 

The decision is set to affect 154 employees at the two sites, with the company committing to support its impacted staff by assisting in finding new employment opportunities.  

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The move is aimed at optimising the company’s manufacturing footprint while enhancing competitiveness. 

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The decision is part of Huhtamaki’s strategy acceleration programme, announced in November last year, which is projected to significantly bolster the company’s profitability.  

Efficiency improvements from this programme are anticipated to yield savings of around €100m ($109.28m) over the next three years, the company claimed. 

The Tianjin and Shanghai sites set for closure reportedly do not contribute enough to Huhtamaki’s sales or profits.  

In Q1 of financial year 2024 (FY24), the company will record closure-related costs of approximately €13m as items affecting comparability. 

The company recently reported a 7% decline in net sales for FY23, totalling €4.16bn, from €4.47bn in FY22.

Headquartered in Espoo, Finland, Huhtamaki provides sustainable packaging solutions for on-the-go food and beverages, as well as personal care products.