Tata Steel Plans Job Cuts in Construction and Engineering Unit

Tata Steel has blamed a 'prolonged downturn in demand' for a proposed restructuring of its business that supplies steel for construction and engineering industries. Tata said the restructure would see 500 job cut, mainly management and administrative functions at sites in its Long Products business in Scunthorpe, Teesside and Workington in the UK.

The proposals are designed to help strengthen its competitiveness, the group said. 'The proposals come amid a prolonged downturn in demand for some of the key products made by the Scunthorpe-based business, including the UK market for construction steel, which is about half of 2007 levels.'

The Long Products business makes plates, sections, wire rod and semi-finished steel for industries including construction, shipbuilding, engineering, energy, foundations and wire drawers. Karl Koehler, Chief Executive Officer of Tata Steel's European operations, said: 'European steel demand this year is expected to be only two-thirds of pre-crisis levels after falls in the past two years.

'On top of the challenging economic conditions, rules covering energy and the environment in Europe and the UK threaten to impose huge additional costs on the steel industry.'

source worldwire