Berlin-based meal-kit provider HelloFresh is set to close its Richmond factory and recently notified 611 workers there that their roles will be eliminated as of Dec. 11, according to Business Insider.
In a statement, a HelloFresh spokesperson told the San Francisco Business Times, Business Insider and MarketWatch that the company will not extend its lease of the distribution warehouse at 2041 Factory St., which expires at the start of 2023. Business Insider notes that the warehouse is currently listed for lease on PropertyShark.
A spokesperson described the Richmond facility as one of the company’s oldest in the U.S., saying it has “an inefficient layout and outdated refrigeration systems.”
Laid-off employees will reportedly receive “financial support, outplacement support and relocation.”
“The decision not to extend the lease is not a reflection of the local teams’ performance, and we are grateful for their contributions,” the spokesperson said.
The Richmond warehouse is one of two HelloFresh locations in the U.S. where workers recently attempted to unionize. In December last year, workers ultimately voted 289-198 against forming a union at the Richmond facility. The effort to unionize came in the wake of high demand for meal kits during the pandemic, but that demand has since lessened.
While HelloFresh’s sales are up this year, the company’s earnings before interest, taxes, depreciation and amortization fell by 23 percent in the first six months, and its shares are down by roughly 68 percent so far in 2022, according to Business Insider.
In his e-forum newsletter, Richmond Mayor Tom Butt suggested that HelloFresh may also have been chased out of the city by the failed policies of the Richmond Progressive Alliance (RPA), whose members hold a majority on City Council. The Richmond warehouse where HelloFresh operates has dealt with vandalism and harassment stemming from the Castro/Hensley RV encampment, and was also among the businesses that saw its tax burden syrocket under Measure U, according to the mayor, who noted the RPA also supported the failed effort to unionize factory workers.