Vapo Oy planning changes to its operating model in order to improve its competitiveness
The sales volume of Vapo Oy’s main product, energy peat, has decreased by approximately 50% over the past five years. In order for the company to respond to the changes in the energy markets and external cost pressures, as well as improve its competitiveness and flexibility, it will commence negotiations pursuant to the Finnish Act on Co-operation within Undertakings for production-related and financial reasons as well as in order to restructure its operations.
The sales volume of Vapo Oy’s main product, energy peat, has decreased by approximately 50% over the past five years. The most significant factor behind this decline has been the decrease in the use of peat in condensing power production by several million cubic metres. Cost per unit produced has increased significantly. In order for the company to respond to external cost pressures, better serve its regional fuel and heating customers and invest in service and product development, it will commence negotiations pursuant to the Finnish Act on Co-operation within Undertakings. The negotiations concerning the company’s plans are based on production-related reasons pertaining to the implementation of a renewal of its operating model, and they are also based on financial reasons related to the improvement of profitability, as well as the restructuring of operations.
The negotiations will concern Vapo Oy’s Group administration functions, the Fuels business, certain units in the Heat and Power business area as well as the regional organisation responsible for production, deliveries and customer relationships. The negotiations do not concern Vapo Oy’s pellet business, Vapo Ventures, or the Clean Waters business. Vapo Oy has a total of 430 employees in Finland, and the codetermination negotiations will concern 249 employees. Based on the current preliminary estimate, the negotiations will lead to the termination of 155 existing positions but, at the same time, 98 new positions involving broader responsibilities will open up in the organisation. This means that the amount of work will be reduced by an estimated 58 man-years at most. The negotiations concerning the planned changes will begin in week 44 (the week starting on 26 October).
According to CEO Tomi Yli-Kyyny, the planned renewal of Vapo’s operating model arises from the need to implement permanent structural changes in response to changes in the electricity markets. “We must adapt to these changes, but even more importantly, our aim is to develop Vapo into a flexible and quick expert organisation that understands and serves its customers, with strengths based on its own competencies in the energy sector, a local way of operating, responsibility, and a commitment to renewal,” Yli-Kyyny says. “While we estimate that we cannot guarantee new positions for everyone in the new organisation, I hope that the planned changes along with the new, more diverse job descriptions in various positions will lead to internal job rotation and the more efficient use of our resources,” Yli-Kyyny adds.
More information:
– Jyrki Vainionpää, COO, Vapo Oy, tel. +358 50 486 9869
– Ahti Martikainen, Director, Communications and Public Affairs, Vapo Oy, tel. +358 20 790 5608