70 laid off as plant closes

Cavalier Corporation says the closure of its Norman Ellison Carpets spinning plant in Onehunga is part of a consolidation exercise to maximise profit.

The company is aiming to deliver $10 to $12 million after tax profit in the 2012 / 2013 financial year.

Chief executive Colin McKenzie says there will be job losses .

"We're hoping that the net reduction will be around 70 jobs, we're trying to relocate eight people within the NEC tufting operation and there's about 12 or so jobs in Napier that we're looking to recruit."

He says while the decision to close the mill was a tough one, it's about reducing overcapacity in the woollen yarn spinning operation that supports carpet manufacturing.

"The reality is that within the group we have three spinning mills, and medium to long term we only require two, so it's a matter of balancing capacity with sales," he says.

First Union general secretary Robert Reid says the plant laid off 26 workers in April.

He says this closure serves as an urgent wake up call for the government to be more proactive in supporting manufacturing.

There were nearly 50 redundancies at Summit Wool Spinners in Oamaru earlier this month.