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Published: Wednesday, 4/16/2014 - Updated: 5 months ago

Owens-Illinois to invest $40M in its Scotland plant

Plan is part of $200M push to strengthen European network

BY TYREL LINKHORN
BLADE BUSINESS WRITER
A group tours an Owens-Illinois glassmaking plant in Alloa, Scotland. The first glassworks was established on the site in 1750. A group tours an Owens-Illinois glassmaking plant in Alloa, Scotland. The first glassworks was established on the site in 1750.
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Owens-Illinois Inc. plans to invest nearly $200 million in Europe this year as it continues a push to strengthen its manufacturing network across the continent.

Most recently, O-I announced plans to spend more than $40 million to upgrade a plant in Alloa, Scotland, that produces more than 2 million glass bottles a day, including bottles for the burgeoning scotch whiskey industry. Exports of scotch nearly doubled in value over the last decade, topping $7 billion in 2012.

O-I officials say the investment, which was announced last week, will primarily allow the plant to better support that growing industry. Nearly all bottles the plant produces go to customers within Scotland.

Perrysburg-based Owens-Illinois is the largest glass container manufacturer in the world, operating 77 plants spread across five continents. Nearly half of those manufacturing sites are in Europe. From last year to the end of this year, O-I expects to invest almost $400 million in its European plants.

“We’re really getting our capabilities closer to our customers, investing in production flexibility, and strengthening innovation capabilities,” company spokesman Lisa Babington said.

O-I has said previously that the investments, along with addressing higher-cost facilities in the region, should improve its long-term profitability in Europe.

In Alloa, O-I will spread the investment over three years, though two-thirds will come this year.

“We have upgraded Alloa’s design, new product development, glass color, and decoration facilities,” Erik Bouts, president of O-I Europe, said in a statement. “We would like to thank Scottish Enterprise for its support in strengthening our ability to serve the developing needs of the spirits industry in Scotland.”

O-I received Scottish government grants totaling approximately $6.5 million.

Specifically, O-I’s investment will help the plant improve its ability to supply premium products by adding new decoration and bottle-printing facilities and increasing the range of colors.

Production capacity is also expected to rise.

Owens-Illinois’ sales in Europe rose 2.5 percent to $2.8 billion last year, representing 40 percent of the company’s global sales of $7 billion. The company has approximately 8,000 employees in Europe out of 22,500 employees worldwide. Ms. Babington said O-I has 5,200 employees in North America.

Though O-I has 35 plants in 10 European countries, Alloa is unique for its history in glassmaking. The first glassworks was established on the site in 1750. At 264 years since the site’s original commissioning, it is the oldest glassmaking site in Europe operating at its original location.

Contact Tyrel Linkhorn at tlinkhorn@theblade.com or 419-724-6134 or on Twitter @BladeAutoWriter.



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