Cadbury says it has saved its Dunedin plant from full closure, even though almost a quarter of the workforce is to go.
The company intends to axe at least 145 jobs from a total of about 700.
The announcements are part of a worldwide restructuring, which will see Cadbury's global workforce reduced by 15%.
The Dunedin plant will no longer make blocks or bars of chocolate, focusing instead on producing chocolate crumb and boxed chocolate.
Other jobs will go at factories in Victoria and Tasmania. Cadbury says the total will about 300 from 2009 - 2010.
Cadbury says $153 million is to be invested in the factories, but it can't rule out the possibility of more jobs going.
Managing director of confectionary in Australia and New Zealand, Mark Callaghan, says the move will increase productivity and profits.
The announcement comes only months after Fisher & Paykel announced it would shed 430 jobs from its Mosgiel Plant and Silver Fern Farms, formerly PPCS, pulled out of the city.
