Danone has warned of an “imminent supply rupture” in Spain as a result of the country’s ongoing truckers’ strike.
The Activia and Alpro maker said if a solution to the week-old strike is not found in the next 24 hours the company will have to “take the drastic decision” to “temporarily interrupt its activity” at its four dairy plans and three mineral water plants in the country.
News agency Reuters reported yesterday (21 March) Spain’s government has agreed to pay EUR500m (US$551.35m) in direct aid to the transport sector, hoping to end the strike, which was sparked by surging fuel costs. Organisers have said the dispute will continue.
Danone said: “The company is confident that negotiations can be accelerated to reach a bilateral agreement in the shortest possible time and thus be able to resume activity as soon as possible.”
However, the French giant warned that if an agreement is not reached imminently it will be forced to stop collecting milk and, “as a consequence, the process of production in its factories and subsequent transfer of the finished product to the supply chains”.
It added: “Until now, Danone has made every effort to maintain all its normal activity despite the difficulties caused.
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“However, the unprecedented situation of instability and the worsening of the strikes are already beginning to affect the supply of essential raw materials for their products such as whole milk or cream.”
Danone, which was actually founded in Spain, employs 2,000 workers in the country. It talks of supplying more than 13.5 million homes there annually. Spain is one of Danone’s largest markets in Europe when measuring annual sales.