Nestlé announces new €37m investment in Girona plant

New cash outlay will create another production line in the Nescafé plant, bringing more jobs

Nestlé, the food multinational firm, will make a new investment of 37 million euros in its Nescafé factory in Girona. The aim of the company is to continue developing its production capacity for instant coffee. This new money injection will create a new production line. "It will feature the latest technology, which will allow us to increase capacity and volume, and make the most technologically advanced products", explained Nestlé CEO, Laurent Dereux, on Tuesday.

Thus, production at the Girona plant will rise from 32,000 tons of instant coffee per year to 38,000. "Its good news because the investment will stay in Girona and because it will help us to export even more", explained Dereux. In addition, the expansion of the production lines will mean the hiring of some twenty more staff, to be added to the 750 employees currently working in the plant. Management explained that it has never stopped investing in Girona, not even during the recession. Since 2007 the plant has received a total of 370 million euros worth of investments, which makes it Nestlé’s largest coffee production factory worldwide.

The plant also produces 2.4 billion capsules annually, over 12 production lines. These lines will remain intact, because the 37 million in new money is earmarked entirely for the area of traditional instant coffee. The work will begin in September, just after the company finishes the expansion of the plant financed by its last investment, of 100 million euros. This new construction phase is expected to be completed by the middle of next year.

Investment in Catalonia, despite the independence process

The group feels that the current moment is ideal for making investments, both in Catalonia and in Spain. "We don't believe that the next few years will see major disruptions in economic activity. We don't get involved in politics, but we are located in many countries and are used to adapting to tsunamis, earthquakes, wars, and anything", said Dereux.

The multinational, which last year billed 2.098 billion euros, had a turnover of 1.535 billion euros in Spain, where it grew by 2.1% despite falling 0.6% in global figures. This year, however, Dereux warned Nestlé’s clients: "We've noticed a strong rise in the price of raw materials, especially green coffee, and this will make some of our products more expensive". Nevertheless, the Nestlé CEO chose not to specify which products he was referring to.

What will certainly not change, according to Dereux, are the prices of the coffee capsules. As regards the competition in this sector (many other brands have begun to make capsules compatible with Nestlé's Nespresso and Dolce Gusto machines), the CEO was clear: "We would rather they didn't make compatible capsules, because then we would be able to grow much more ourselves, but in the end competition is good and forces us to improve. In any case, we have never stopped growing in the coffee capsule segment, and we continue to be the leaders, in quality as well", declared Dereux.

Critical of the sugar tax

Nestlé also criticized the imposition of new taxes aimed at reducing health problems. "We share the World Health Organization's concerns about sugar, but we don't feel that a new tax is a good response to a multifaceted problem", argued Dereux. Nestlé has thus addressed the question in advance and taken a clear position on the debate over whether the tax could also end up being applied to chocolates or industrial pastries. He also asked that no ingredient be stigmatized, in reference to the controversy over palm oil, which can also be found in small doses in some of the company's products.

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