Gregg's coffee production manager Glenys Fraser with a
cuppa outside the Gregg's factory in Forth St, Dunedin.
Photo by Gerard O'Brien.
Cerebos Gregg's has confirmed it will pump $10 million
into expanding its Dunedin-based coffee factory and close its
East Tamaki, Auckland, manufacturing plant at the end of this
Cerebos Gregg's announced yesterday it would consolidate its
coffee and food production to Dunedin and Sydney - a decision
expected to result in the loss of up to 125 jobs from its
Auckland plant when it shuts on December 19.
Cerebos Gregg's New Zealand country manager Andre Gargiulo
said millions of dollars had already been invested in the
A further $10 million would be injected into the Forth St
factory in the short term, to redevelop the site and install
new plant and packaging machinery.
At present, the facility only produces instant coffee, but by
December it was expected roast and ground coffee would also
be manufactured at the site.
The facility would become the centre of the company's coffee
production in New Zealand.
Mr Gargiulo said the Dunedin expansion would require only an
extra ''handful'' of employees to run it in the short term.
About 40 people worked at the plant, he said.
He would not be drawn on future job numbers and could not say
by how much production would increase at the Dunedin plant.
''Our view at the moment is it will certainly contribute more
to the local community and to the economy with increased
production, increased activity in Port Chalmers, et cetera,''
Cerebos Gregg's chief executive Terry Svenson said the
company would close its East Tamaki plant because it was
becoming too costly and inefficient.
''Our East Tamaki factory now needs major capital investment,
but we can't justify continuing to invest money in this
ageing plant when we already have more modern manufacturing
facilities capable of increased volumes,'' Mr Svenson said.
''To position ourselves for future growth, we have to
consolidate our manufacturing operations.
''Shifting our coffee and food production to our sites in
Dunedin and Sydney is the only feasible option.''
The company employs about 450 people in New Zealand and 500
The company's head office would remain in Auckland, he said.
Dunedin Mayor Dave Cull said he was a little surprised by the
Cerebos Gregg's approached Dunedin City Council staff several
months ago, seeking advice about refurbishing and upgrading
its Dunedin factory, he said.
But he was unaware the company planned to close its East
Tamaki plant and move its entire coffee production to
''Clearly, this is a very positive development for Dunedin,''
Mr Cull said.
''We've worked really hard with them to make it as easy as
''I'm delighted that our council efforts have been able to
come out with such a good result for the city and Cerebos
Otago Chamber of Commerce chief executive John Christie said
the company's decision would provide significant economic
benefits for the city.
''Obviously, capital investment of this magnitude is
something that Dunedin is always wanting to attract,'' Mr
Regional centres such as Dunedin were attractive in terms of
operation costs and its readily available infrastructure, he
''We know Dunedin's a cost-effective place to do business
from, and I think when you look at a company like Cerebos
Gregg's making that decision to be here, it's an entirely
''I'm surprised there's more companies in New Zealand that
don't do that,'' Mr Christie said.