Oatly to close S’pore facility, 34 employees affected

Swedish oat milk brand Oatly will be closing down its manufacturing facility in Singapore, located at Senoko Way.

The closure is expected to improve the company's cost structure and reduce capital expenditure needs in the future, said Oatly in a press release on Dec. 18, 2024.

As a result, 34 staff members at the plant will be affected, and their outplacements will take place through "a phased approach" over the next few months, an Oatly spokesperson told Mothership.

Affected employees to receive outplacement assistance and training

The spokesperson added that the company is "committed to supporting all impacted employees and ensuring they are treated with respect and care in line with the company's values", including offering "outplacement assistance and training".

In March 2021, Oatly and local beverage company Yeo Hiap Seng Ltd announced that Yeo's Senoko Way manufacturing site would be manufacturing Oatly's oat milk.

The opening of the facility, which was dubbed "Asia's first oat milk manufacturing facility", marked the first time that Oatly products were produced outside of Europe and North America.

At the time, the companies said they had jointly invested S$30 million in the facility and the equipment.

Asset-light supply chain strategy

According to Oatly, the closure of its Singapore facility was part of the company's "ongoing evaluation of its Asian supply chain network".

Following the closure, the expected growth in the Asia-Pacific region will be supported by the company's existing facilities in Europe.

Oatly added that these actions are expected to further increase capacity utilisation of its European factories.

Additional details on the closure will be released by the company in early 2025.

Aims to be 'efficient with capital & costs'

Commenting on the company's decision, Oatly's chief executive officer (CEO) Jean-Christophe Flatin expressed his "deep gratitude" to the Singapore team for their contribution.

He said the closure is expected to capitalise on improvements made to capacity and efficiency.

Flatin added that Oatly's "simplification of operations" is expected to continue.

According to the company's annual report 2023, Oatly suffered a loss of US$417 million (S$563 million) in the last financial year.

Top image via Xiaohongshu