Tata Steel may axe over 700 jobs in UK

India, July-17 Tata Steel may cut 720 jobs in its speciality steel business as low-priced imports from China and high production costs impact its ability to compete in the cut-throat UK market. Most of the jobs will be slashed at the company's Rotherham, northern England plant, the metals giant said Thursday. Cheap foreign imports due to a strong pound and expensive electricity costs, which is more than double of its nearest competitors, is forcing Tata Steel to look at restructuring its speciality steel business. The unit will now concentrate more on high-value sectors like aerospace. Tata Steel is currently the world's third-largest steel supplier to the aerospace industry.

The proposed job cut announcement comes a day after Tata Steel's UK workers agreed to a new pension scheme, which prevented a potential strike that could have been the biggest industrial dispute in Britain's steel sector in more than three decades.

"Energy is one of our largest costs at our speciality and bar business and we are disadvantaged by the UK's cripplingly high electricity costs," said Karl Koehler, Europe head at Tata Steel, which in recent years has invested over 20 million pounds in the business.

"While the UK government announced helpful measures to reduce the impact of its high energy taxes a few years ago, these measures still haven't been introduced," Koehler added. "Now is the time for government to act. Foundation industries like ours urgently need a competitive business environment and a government willing to strengthen UK manufacturing supply chains. This would ensure the UK remains an attractive place to invest," he stressed. The Tata Group, of which Tata Steel is a part, is one of largest private sector employers in UK.

Tata Steel has been restructuring its European operations by cutting costs and jobs since 2007 when it acquired Anglo Dutch producer Corus for $13 billion. It currently has about 17,000 people on its rolls compared to 25,000 in 2008. Tata Steel said it has "identified 720 positions which will potentially become redundant" and will work closely with those at risk to redeploy them to minimise the number of compulsory redundancies. After the job cut, Tata Steel will still have about 1,500 people in Rotherham.

Source: TOI