Bowater production cut - permanent or not?

Communications, Energy and Paperworkers Union of Canada Local 141 President Courtney Wentzell said the sudden news wasn’t surprising because parent company, AbibitiBowater Inc. had asked Bowater to study the feasibility of shutting down one of the plant’s two paper making machines. “The capacity needs to get off the market. The only surprise is it’s us because we’re a viable operation that makes money when two machines are running and we’re not in bankruptcy. The only surprising thing is they picked us.”

AbibitiBowater is under creditor protection. However, the Bowater plant isn’t because it is 49 per cent owned by the ever-quiet The Washington Post Company Ltd. The company also announced it would be suspending production at various Canadian and United States mills, which will affect about 1,500 employees. The company is facing an ongoing drop in demand that is at about 30 per cent this year, led by both structural changes in the media that is linked to the internet, and the economy in general. In addition, the company is burdened by billions of dollars worth of debt.

Union executives are currently in a meeting with Bowater officials discussing the sudden announcement. Before the meeting, Wentzell said they were under the belief the mill would re-open Oct. 5 as scheduled before the machine is taken out of production on Oct. 31.

He added all news releases about work-sharing through a federal E.I. program are false at this point because they don’t know if the machine is being idled or permanently shut-down. “It’s not a confirmed plan or anything. The first thing we got to find out today is it idled or is it done.”

He showed disdain over being repeatedly asked questions by the media about how the workers are taking the news. “How do you think we feel?”

More details will be released after the meeting, including whether or not the loss is permanent.

Local 259 union President Stephen Kennedy was not available for comment.

Former union president and retired employee, Jack Thistle said before the announcement, “in my personal opinion” the plant will soon close under one machine, as employee costs would not go down much and, therefore, per tonne costs would drastically rise. “It has to (lose money) because if you’re only running one machine, you’re only making half the paper with 90 to 95 per cent of the people making that newsprint.”

He explained most employees that work directly on the paper machine could lose their jobs but they’re only a small part of the workforce. He said the workforce making the pulp and in the wastewater treatment plant, for example, wouldn’t go down much and the number of electricians and millwrights wouldn’t fluctuate much as well.

He said he wants to stress this is his, and other’s, opinion only, but that he believes the cost per tonne would rise by up to 40 per cent. “That’s speculation but it does make sense to me.”

He said, as his “personal opinion” once again, the mill would lose money and “start to accumulate debt,” something that has been rare at Bowater Mersey. “After they accumulate so much debt, what they’ll say is it needs to go bankrupt.” The benefit to the company is debts would be paid before the workers received severance, for example, he said. “If they go to one paper machine, it’s the writing on the wall. It makes the newsprint far too expensive when the price is already depressed. It has to lose money; it just wouldn’t work.”