Banbury's coffee factory to cease production with the loss of up to 280 jobs - 'devastating' says union

Shocked staff were told in a ‘Town Hall’ meeting at a south Northants hotel this morning.

Factory owner, JDE (Jacobs Douwe Egberts) is to move coffee production to its big sites in Holland and Germany. The research and development labs will also close with work transferring to the Dutch operation. Production will end in Banbury on February 29, 2024.

It is thought the factory – still known around Banbury by its former company names, General Foods and Kraft – was closed and the entire staff bussed to Whittlebury Hall for the announcement. Of 410 staff, around 250 in production and 30 in research and development will be made redundant.

A source told the Banbury Guardian: "There was stunned silence when they made the announcement to be honest – people are still in shock.

“There will be 250 redundancies from the manufacturing area of the Banbury factor. Also the big announcement is that the coffee plant, which is the big tower, will be closed completely.”

There are plans for a new 63m Euros coffee plant factory in Poland but JDE said this has nothing to do with Banbury’s decisions to move production to Europe.

The source continued: "The packing area will remain but operators are being forced to take a big pay cut as of April 1, 2024 - up to £15,000 pay reduction – but packing will be closed once a new packing facility is found in the UK and EU.”

JDE said details of pay and conditions will be subject to consultation and negotiation with unions and staff.

The company says the Ruscote Avenue factory is expensive and the least competitive of its plants.

A spokesperson said: “We have today announced proposed changes to JDE’s Banbury factory. We are proposing to close the processing part of the site and focus solely on becoming a specialist coffee packing facility. This is an important and necessary change, enabling Banbury to remain a key facility in the JDE network.

“The industry is operating in a challenging economic environment and there is an overcapacity of freeze-dried coffee in our European factories which is expected to remain.

“Banbury has been, and continues to be, the least cost-competitive factory in our network to process coffee. This means changes must be made to improve the competitiveness of the site.

“Regrettably, this means that circa 250 roles will be at risk of redundancy. We are also proposing to close the R&D facility at Banbury which will impact a further 30 roles. If the proposals move forward, we expect that 134 roles will remain at the site.

“Banbury has long been associated with coffee and we are proud that there will be a continued presence in the town. Our decision to stop processing at Banbury has not been taken lightly and all other possibilities were rigorously assessed. It in no way reflects the hard work and dedication of all who work at Banbury, and we are working to support all impacted associates.”

Paul Fletcher national officer of Unite the Union, said: “The potential loss of so many JDE jobs is devastating news for its workers and Banbury as a whole. Unite will be offering support to our members at this difficult time.

“We will now be entering consultations with JDE and will leave no stone unturned in seeking alternative plans that are less damaging than the ones put forward.

“If jobs do have to go, we will ensure our members’ best interests are the priority, including negotiating against compulsory redundancies and for the best possible severance packages.”

Proposals are that coffee currently produced in Banbury will be made elsewhere in the wider network, including Joure in the Netherlands and Elmshorn and Hemelingen in Germany.

Cllr Sean Woodcock, Labour leader in Banbury, said: “The coffee factory is as much a part of Banbury's heritage as its economy . My grandmother worked there back in its earliest days until she retired. So the news that 280 jobs are to be axed at Jacob Douwe Egberts is simply awful.

“Workers were threatened with 'fire and rehire' two years ago, which Labour have said we will ban if we form a government. But with the wholehearted support of the town managed to resist these plans and hoped that their jobs were safe.

“This is a real blow and my thoughts are with those employees affected and their families."

Banbury MP, Victoria Prentis said: “I have been made aware this morning that redundancies are to be made at the Jacob Douwe Egberts site in Banbury in February next year. I know this will not have been an easy decision for the management to come to but JDE like many other companies are faced with having to adapt to some of the challenges associated with rapid advances in technology.

“While this has come as disappointing news given how important the factory is to our town, no official decision has been made at this point. I understand that all associates have been briefed today and a consultation will be launched at the end of the month. It is important that all associates facing the possibility of redundancy participate and make their views known. I know that JDE will be carefully listening to concerns throughout this difficult process.

“I will be speaking to the Plant Director later this week to discuss their plans in better detail. I will update constituents when I have more information to share and anyone affected can get in touch with me at [email protected].”

Staff, fought – and lost – a battle against contentious ‘Fire and Rehire’ plans in 2021.