SodaStream to relocate its sole West Bank factory

CEO: Economics, not politics reason for move

By
October 31, 2014 02:35
2 minute read.
SodaStream pitchwoman Scarlett Johansson

SodaStream pitchwoman Scarlett Johansson. (photo credit: Courtesy)

SodaStream will relocate its sole West Bank factory to the Negev by the end of 2015, the company announced this week, less than one year after it was the subject of an intense boycott campaign by pro-Palestinian activists.

The company known for its homemade soda making machines, was catapulted into the limelight of the Boycott, Divestment and Sanctions movement when famous Hollywood actress Scarlett Johansson became it’s global ambassador last year.

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At the time, the company defended its West Bank factory located in the Mishor Adumim Industrial park, located just outside the Ma’aleh Adumim settlement, as an oasis of coexistence where Israelis and Palestinians worked together.

The BDS movement has hailed the closing of the SodaStream factory as a victory. But company spokeswoman Nirit Hurwitz said on Thursday that the move, which was part of an overall growth plan, was based on economics not politics.

“The decision is purely commercial,” she said.

She explained that SodaStream was also closing a factory in the Galilee. The employees from both factories will be folded into a new state of the art facility in Lehavim near the southern city of Beersheba, Hurwitz said.

The factory, she said, “received a $20 million grant from the Israeli government.

[It] will become our flagship manufacturing site and is expected to deliver operational excellence and result in savings of 2 percent across our entire cost base.”

SodaStream has asked the IDF and the government for permits so that its Palestinian employees can work in the Lehavim factory. It has even promised to provide them with transportation to and from work.

Company CEO Daniel Birnbaum said that “while we are enthusiastic about our new Lehavim facility and the exciting promise it brings to our company, we are committed to doing everything in our power to enable continuity of employment to our family of employees.”

He added, “We hope all our employees will choose to stay with us. For those employees who will not be able or willing to relocate to Lehavim, we will assist them to the best of our ability in providing placement support.”

The company’s growth plan is a response to a slump in sales and revenues in 2014.

On Wednesday the company said that its revenues for the third quarter of this year were $125.9m. compared to $144.6m. in the third quarter of 2013.

Birnbaum blamed the drop on “challenging selling conditions for soda makers and flavors primarily in the US.”

He spoke this week with the Palestinian workers in the Mishor Adumim factory.

Birnbaum said the West Bank facility had played a unique role as a bridge for peace and hope in which Israelis and Palestinians worked together. With God’s help, he said, he hoped that in the future they could also dance together at holiday celebrations.

“This is not just another factory,” he said.

He recalled how boycott calls had sent over 100 journalists to the factory. The controversy, he said, gave the company motivation to remain in Mishor Adumim.

“Do not let anyone say we left here for political reasons.

It is not true. We stayed here because of politics,” he said.

“The reason we are leaving is simply economics.”


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