June 22, 2006

Toymaker ‘disassembles’, moves its building blocks production to Czech

COPENHAGEN

The earliest inspiration for many an architect and engineer, Lego building blocks, is making a major shift in its business.

The Danish toymaker Lego Group will move one-third of its domestic production to the Czech Republic and lay off two-thirds of the staff — up to 1,200 employees — in Denmark.

The Vejle Amts Folkeblad Daily said the company famous for its colourful plastic building blocks will move its production to Kladno in the Czech Republic, where Lego already has a factory.

There are about 3,000 employees at the production facility at Lego’s headquarters in Billund, 255 kilometres west of Copenhagen.

In September, Lego — a rival of Canada’s Mega Bloks Inc. — said it was considering moving all or parts of its production to Eastern Europe or China, and said the restructuring plans could affect all of its production facilities.

A month later, Lego announced it was closing a production facility in Switzerland and five European distribution centers, and moved those operations to the Czech Republic. That moved affected 540 workers.

Founded in 1932, Lego’s name was invented by combining the first two letters of the Danish words “Leg godt” (play well) without knowing that that the word in Latin means “I assemble.”

ASSOCIATED PRESS

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