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Quartz crystal components maker Rakon is shedding 45 of its 500-strong Auckland workforce as it looks to cope with a fall in demand.
Managing director Brent Robinson said most were from its manufacturing operations, with a lesser number from support and administration.
"We are making these staff reductions now to ensure Rakon is in a strong position to be able to capitalise on both near-term and future growth opportunities. We have not made any reduction to our large engineering group and are ensuring we are in a good position to capitalise on new market opportunities."
Cost savings from the lay-offs were not immediately available, but the move is part of an ongoing review of expenditure signalled last week during the company's half year profit announcement, where it reported a 66 per cent plunge in net earnings.
The fall in tax-paid net profit from $5.7 million to $2 million has been attributed to a rise in depreciation and financing costs, a higher effective tax rate because of operating losses at its French factory, and a fall-off in demand in the consumer-focused elements of its business, which is mainly serviced by its Auckland base.
Its other operations, such as its British manufacturing facility which supplies to the telecommunications market, continue to perform well.
The challenging economic environment has already seen the company freeze the salaries of senior managers, and defer the construction of its Chinese joint venture factory by about six months.
The factory in Shenzhen was not now expected to begin construction until April. Rakon shares closed up 3c yesterday at $1.03.
