US wholesale baker Interstate Bakeries has said it plans to close several plants and invest in automation in order to offset rising labour expenses.

The company did not give details as to how many plants would close or how many jobs would be cut, but said recent union contracts had meant that labour costs had risen more than could be offset by increased sales, reported Reuters.

“We have to automate and we will. We have to rationalise production,” James Elsesser, chief executive officer, said.

The company said it expects to provide details of plant closures after a management meeting due to take place at the end of September.