In a move likely to create around 250 jobs, the disk drive manufacturer Seagate is to press ahead with a new factory in Derry. The company, which pulled out of Clonmel, Co Tipperary, earlier this year with the loss of 1,400 jobs, said the decision had no implications on whether it would go ahead with another proposed factory in Cork.
Seagate said it would build "50 per cent" of the wafer fabrication plant at Springtown, in Derry city. The original plan would have created 1,100 jobs over five years, but industry sources predicted the scaled-down project would generate between 200 and 300 jobs over two years.
"Business conditions today allow us to take advantage of opportunities that were unavailable to us last December," said Dr Brendan Hegarty, executive vice-president and chief operating officer of Seagate's recording head group.
"While oversupply and associated price pressure still exist in the disk drive business, advanced generation Magneto Resistive (MR) products and the technology requirements associated with the development and production of advanced MR products require us to move forward with the Springtown expansion in order to meet market requirements."
Dr Hegarty said the investment helped position the company for future opportunities and strengthened its market capability.
The project will see Seagate outfit half of the huge empty building beside the factory it already runs with just under 1,000 workers in Derry. Another factory, at Limavady, Co Derry, employs a further 1,000.
Seagate said the decision to go ahead with the new facility in Derry did not have any implications for its suspended blueprint for Cork, because the proposed factories performed completely different stages of the manufacturing process. The Derry plant will make read/write heads for hard disks and tape, while the plan for Cork would see a factory perform "sputtering", or laying a magnetic coating on substrate disks.
A spokesman for Seagate said last night the proposed Cork plant had not been abandoned and was still under review.
"When we require additional media capacity, Cork is still our preferred location," he added.
In December, Seagate announced that it would close its factory in Clonmel with the loss of 1,400 jobs. The move devastated the town and infuriated employees and Government agencies. Seagate has since paid back the £11 million in IDA Ireland grants.
