The Swissmetal group has confirmed it wants to close its foundry in Reconvilier in northwestern Switzerland and concentrate its activities at another site.
The move, aimed at saving SFr5 million ($3.8 million) a year, will involve more than 40 job cuts. Employees have said they will fight the cuts.
In a statement released on Monday, Swissmetal said that it intended to focus its activities in Dornach, canton Solothurn.
But before it could take a definitive decision, "some clarifications" had to be made with the cantons concerned in order to "take into account the regional political interests." The group said it had sent them a letter.
Swissmetal said that the changes were being implemented following "analyses carried out on technical and economic levels."
But the group confirmed that it would still continue its five-year SFr75 million investment programme for the two sites.
It said that it aimed to increase productivity and make overall savings of SFr14 million at Reconvilier and Dornach.
About 300 employees decided against collective strike action at a meeting on Monday morning but they said they would oppose the restructuring.
"We can also envisage some stoppages in certain sectors," said Nicolas Willemin, the staff spokesman.
Swissmetal, which makes semi-finished copper products, celebrated the 150th anniversary of the Reconvilier plant in September.
Latest restructuring step
The move to close the foundry is the latest step in the company's restructuring plans. Swissmetal has already announced the loss of 150 of its 750 jobs over the next five years.
Several hundred people demonstrated against these cuts and the possibility of the foundry closure last week. They also called for the company's controversial chief executive, Martin Hellweg, to step down.
These protests came just one year after 400 metal workers and staff at the Reconvilier factory staged a major ten-day industrial action against the company's restructuring plans.
Strikes are still a rare occurrence in Switzerland.
Reacting to Monday's news, the trade union, Unia, said assurances by Swissmetal last week that it had set up a working group to make a study on the future of Reconvilier before any decision had not been respected.
It argued that the future of the foundry had already been decided and the group had never met.
The mayor of Reconvilier, Flavio Torti, also intimated that management had not been entirely truthful.
He told the Swiss news agency that he thought the company was not taking into account the needs and talents of its employees, and was more interested in making a quick profit.
Earlier this month, Swissmetal announced that third-quarter sales dropped by five per cent to SFr147.4 million, while net profit shrank by half to SFr2.6 million.
swissinfo with agencies
Swissmetal third-quarter figures:
Sales: SFr147.4 million (-5%)
Core profit: SFr2.6 million (-50%)
The company suffers from overcapacity in the sector and the high price of copper on the commodity market.
Swissmetal's five-year strategy is based on the consolidation of activities between the sites at Reconvilier and Dornach.
In the downstream area of cold forming, Dornach will concentrate on manufacturing complex profiles and tubes, while Reconvilier will become the centre of competence for premium wires and rods.
The restructuring will result in the loss of 150 jobs out of 750.
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