VAT Media Release on Extension of Short Time Work
Ad Hoc announcement pursuant to Art. 53 LR
VAT EXTENDS SHORT TIME WORK FOR ITS PRODUCTION EMPLOYEES IN HAAG
VAT Group announced today that it will extend the current short time work scheme for about 650 production employees at its two manufacturing facilities in Haag, Switzerland. The program was approved by the Canton of St. Gallen’s Office for Economy and Labor for a period of three months until the end of November 2023.
The extension of short time work reflects persistent challenging market conditions, especially in semiconductor equipment and allows VAT to provide job security and retain employees who have received significant technical training so that the company has the resources it needs to quickly meet the recovery in demand still expected in 2024, as VAT has previously communicated.
The program is not expected to have any adverse effect on customers or product quality. VAT successfully implemented a similar program during the severe market downturn in 2018 and 2019.
The current downturn reflects sharply lower spending by semiconductor customers in the face of slower consumer spending, persistently high interest rates, and lower economic growth in many markets. Trade restrictions by the US and other countries on exports to China of integrated circuits and related manufacturing equipment continued to negatively impact demand for VAT products.
As a result, and as previously reported, VAT expects demand to remain muted over the rest of 2023 before returning to growth in 2024, driven by positive long-term drivers such as global digitalization and the transition to renewable energies. In anticipation of this recovery, VAT continues to make significant investments in its facilities in Switzerland, including an innovation center in Haag, expected to be opened early 2025.