News

Diageo is to cut more than 700 packaging jobs in a total 900 redundancies as it restructures its Scottish operation to ensure long-term sustainability.

The Kilmarnock packing plant in Ayrshire will be closed by the end of 2011 and Diageo will consolidate packing operations with its other facilities in Glasgow and Fife, resulting in around 700 job losses.

Diageo temporarily closed the Kilmarnock plant in March and April in bid to tackle costs.

Thirty jobs will also be lost at the Shieldhall packing plant in Glasgow, although Diageo has said there will be no compulsory redundancies at any of the sites for 12 months.

The company is, however, investing £86m in expanding its Leven plant in Fife and creating 400 new positions. If it obtains planning permission, it will build a new packaging hall in Fife to open in mid-2011.

Diageo is also closing the Port Dundas distillery in Glasgow and adjacent Dundashill Cooperage resulting in 140 job losses, and will relocate a number of other staff as part of the restructuring.

The firm maintained that a £100m investment reflected its commitment to Scotland and that it would continue to employ almost 4,000 staff across the country.

Bryan Donaghey, managing director of Diageo Scotland, said the "extremely difficult decisions" had been made after an exhaustive review of all possible alternatives.

"We believe the plans outlined today will help secure the sustainability of our business in Scotland. We need to be competitive in a global context and the restructuring is a key part of this."

Diageo said that 85% of its Scottish output is shipped to more than 180 countries around the world.

Diageo produces a large number of the world's best known alcoholic drinks including Johnnie Walker, Guinness, Smirnoff, J&B and Baileys.