SodaStream - September 2012 UpdateSep 2012
In contradiction to SodaStream's recent statements, the company's main manufacturing facility is still located in the settlement Industrial Zone of Mishor Adumim.
Soda Stream's "principal manufacturing facility is located in Mishor Adumim…" – as the company clearly indicates in page 16 of its annual report for 2011 to the American Stock Exchange, published on April 2012 (see: http://bit.ly/PrnAQx).
The company further elaborates about its production process:
"Most of our products are manufactured at our two Israeli facilities, in Mishor Adumim, east of Jerusalem, and in Ashkelon, on the Mediterranean coast. In Mishor Adumim, we have a metal factory, plastic and bottle blowing factory, machining factory, assembly factory, cylinder manufacturing facility, CO2 refill line and cylinder retest facility. In Ashkelon, we manufacture the flavors that are distributed worldwide. … We also outsource the production of certain components of our products to two subcontractors in China. In addition, we conduct CO2 refilling … in Australia, Germany, Israel, the Netherlands, New Zealand, South Africa, Sweden and the United States. …" (p. 36).
On September 19, 2012, Who Profits has contacted the company's Israeli facebook page – see print screen (in Hebrew) in the right side of the screen. We asked where the company's products are manufactured, is all the production being done in one factory and if they operate factories abroad. The company answered that all of SodaStream's products are manufactured in the company's production sites in Mishor Adumim and in Ashkelon.
That means that products sent to every country in the world are manufactured in the Mishor Adumim and Ashkelon factories. The Alon Tavor facility is not considered by the company to be a production site. The facility is mainly a warehouse and it handles the painting and assembly of the machines. The Ashkelon plant manufactures only the flavored syrups.
The company's Job offers, published in its website and other human resources websites in the past few days give additional indication regarding to the company's production line. While the facilities in Airport City, Ashkelon and Alon Tavor require administrative positions, the facility in Mishor Adumim requires a maintenance manager with a background in engineering and a manager for the factory's supply chain.
Ragarding the new factory that SodaStream is building in the Negev, the company states that it started building the factory in 2012 and the first phase should be completed "within approximately 24-36 months from the commencement of construction. The total anticipated capital expenditure required for such facility is approximately €30 million. In April 2012, we obtained a grant from the Israeli Ministry of Trade and Industry for the construction of the additional facility in the amount of approximately €5.05 million, which is subject to a number of conditions. However, the timing of construction of such facility is not yet finalized" (p. 36-37).
Even if the company intends to move its production line to the Negev factory and close the Mishor Adumim factory, the new factory's first stage of building is only to be completed in two-three years.
The company does indicate that the Mishor Adumim factory is some sort of a liability, but it also mentions the profits made by tax benefits to a settlement factory. The company's statements also show that it employs Palestinian workers in its West Bank factory.
SodaStream wrote in its annual report: "… There has recently been negative publicity, primarily in Western Europe, against companies with facilities in the West Bank. … Though we manufacture certain of our products in other locations, this may not persuade such political groups sufficiently to end their call to boycott our products. In addition, the Palestinian Authority has adopted legislation that may prohibit or restrict Palestinians from working for Israeli companies located in the West Bank. For these reasons, we may in the future be required to transfer a significant portion of our manufacturing activities to a location outside of the West Bank, which may divert the attention of management, require the expenditure of significant capital resources and limit certain of the tax benefits for which we are currently eligible" (p. 16-17).
Since the Alon Tavor facility is not involved in the manufacturing process and the Ashkelon plant only manufactures syrups – the company's production line must go through the west bank settlement factory in Mishor Adumim.