The cosmetics company Coty is in crisis – and wants close the only location in Germany. 300 employees are threatened with unemployment. What’s behind it.
The cosmetics group Coty is one of the world’s top perfume manufacturers and produces for brands such as Hugo Boss, Adidas and Gucci, among others. In 2020 alone, the company generated sales of more than 4 billion US dollars. At first glance, that’s a lot, but it also reflects the company’s clear downward trend: in 2017, annual sales were still over 7 billion US dollars. Of course, such a loss of profit does not create a champagne mood in the executive suite either, but it meant, above all, the risk of job loss for the employees.
This danger is currently becoming more concrete at the company’s Cologne location in Bickendorf: In February of this year, the corporate management announced the closure of the local plant – an announcement that was “completely surprising” and “like a raid” for the 300 employees, like the mining union , Chemistry and Energy Cologne-Bonn (IG BCE) explained. The planned closure of the Cologne location actually comes as a surprise. After all, it has been expanded into a so-called “Center of Excellence” in recent years with great financial and human resources.
“Irresponsible handling of the fate of employees”
As IG BCE further explains, a conclusive reason and explanation for the closure is still pending, which should be done by summer 2022. Robert Flesch, the chairman of the works council at the Cologne plant, is also shocked: “In recent years we have always given everything for the success, maintenance and further development of the location,” said Flesch. “That is why we are all the more stunned how irresponsibly the high investments of the last few months, the fate of the employees and the importance of our location for the Cologne region are being dealt with here.”
In fact, the work is very important – not just for the employees and the Bickendorfer Veedel. Coty is deeply rooted in Cologne-Ehrenfeld: Until 2003, the real Cologne water “4711” was produced here, during the corona pandemic the plant donated disinfectants to the St. Franziskus Hospital in Ehrenfeld and local senior citizens’ facilities.
Solidarity, which is now returned to the employees of the plant, at least by the Cologne residents and the Ehrenfeld district council. The district council, which learned “with great dismay of the cosmetics company’s plans”, calls on Coty to withdraw the closure.
Udo Hanselmann (SPD): “Appeals to social responsibility fade away”
“The announcement by the management not only surprised me, it also shocked me that 300 jobs are to be lost in one fell swoop,” says district representative Udo Hanselmann. As the SPD politician goes on to explain, not only would jobs be lost, there is also a risk of losing a traditional company in Bickendorf, which could be prevented.
In doing so, Hanselmann admits that politicians do not have many opportunities to influence such company decisions: “In principle, appeals to the social responsibility of the management go nowhere,” said Hanselmann.
As the district representative explains, one finally has to consider that although the Bickendorfer plant is the only location of the group in Germany, it also produces in Spain and France. The European production is now to be completely outsourced there. Why, of all things, the Cologne plant should fall victim to the closure raises many questions. The US company, whose main shareholder is the German billionaire family Reimann, justified the closure with the fact that the capacities in the product segment “fragrances” had been exhausted.
Speculation about the sale of the factory premises
In fact, it is speculated that the reason for the planned closure of the Cologne plant could be the valuable property on which the Bickendorfer factory is located. This measures at least 170,000 square meters: “Selling the property would bring in a multi-digit million amount,” explains SPD politician Udo Hanselmann. “If this area were then rededicated for residential construction, it would most likely only be high-priced apartments.”
In practice, however, the use of the area for residential construction could turn out to be difficult: In the zoning plan of the city of Cologne, the factory site is designated as an industrial area – and can therefore only be used as such: “We will confirm this again in a resolution” , says Hanselmann.
“A difficult but necessary decision”
It is questionable whether the planned closure of the Cologne location can still be averted. Compared to the “Handelsblatt”, Coty boss Sue Youcef Nabi said that the closure of the plant in Cologne-Bickendorf was not an easy decision, but it was necessary – after all, the company is in debt with billions of dollars.
The US company is hoping for help from influencers Kim Kardashian and Kylie Jenner, whose perfume brands are now being produced. The “Handelsblatt” quotes boss Nabi as saying that the social media coverage of the two is of inestimable value. The 300 Cologne employees of the company shouldn’t care much about the number of followers of the Kardashians: They will continue to protest against the closure.
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