Israel: Sonol Cuts Staff on High Fuel Prices
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Wednesday, 05 October 2011 |
Sonol Israel has announced that it will be cutting its workforce by 300 employees through a hiring freeze and redundancies. CEO Nir Galili confirmed the move, which he said had been forced on the company by reduced profit margins from high wholesale fuel prices. Galili said that the company could only remain profitable it it implemented efficiency measures, including a reduction in staff, introducing self-service only pumps and altered contract terms with key customers.
Minister of Finance Yuval Steinitz and Minister of National Infrastructure Uzi Landau cut fuel margins for self-service gasoline to NIS 0.589 per litre from NIS 0.710 per litre last month. The move was aimed at encouraging customers to use self-service gasoline. Sonol, Delek Israel Fuel Corporation, Dor Alon Energy and Paz Oil Company petitioned the Israeli High Court against the cut, but the court did not cancel the directive. Sonol has since cancelled discounts for customer clubs and notified owners of fuel service stations that they wish to renegotiate contracts. Sonol is looking to cut the rent it pays fuel service station owners. From NIS 0.25 per litre to NIS 0.16 per litre.
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