We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info
A company has said that more than 400 jobs have been put at risk as part of a major restructuring plan amid soaring energy costs.
Liberty Steel, which has said it will idle its manufacturing operations in Newport and Tredegar, said “major competitiveness issues” had led to its decision and will impact 440 roles across the firm.
Liberty, which is part of Sanjeev Gupta’s GFG Alliance conglomerate, said on Thursday that it would cut production and make some of its smaller sites idle. The sweeping restructure includes converting the Newport site, where it has a hot-rolled coil mill, into a storage “distribution and trading hub”.
Its plant in Tredegar, where it produces tubes and cold-formed sections, will also be mothballed.
A total of 444 jobs are at risk, reports WalesOnline. Up to 185 posts could go at Rotherham, 121 at Newport, 99 at West Bromwich and 35 in Tredegar. The company blamed “unviable” market conditions including high energy costs and the impact of cheaper imports for its decision which it said would help it focus on its “high value alloy steel production” at Rotherham, Stockbridge and Brinsworth in Yorkshire.
Liberty has faced increasing financial pressure since the collapse of its biggest lender Greensill Capital in 2021. On Thursday it said it will offer affected workers an alternative to redundancy through a programme to retain, redeploy and reskill affected workers. The company employs over 5,000 people at 30 sites across the UK and said it would be consulting with workers, unions and the government through its restructure.
Jeffrey Kabel, chief transformation officer for Liberty Steel Group, said: “Refocusing our operations will set the right platform for Liberty Steel UK’s high-quality manufacturing businesses to adapt quickly to challenging market realities. The support of our marquee customers will enable us to produce high-value, differentiated products through 2023 and beyond for strategic sectors such as aerospace, defence and energy.
“We remain committed to our longer-term growth plans in the UK including our plan to grow Rotherham into a two million-tonne green steel hub. While our action is expected to regrettably impact the roles of some of our workforce, we will provide a level of guaranteed salary and outplacement opportunities through our unique workforce solutions programme as an alternative to redundancy.
“Liberty’s shareholder Sanjeev Gupta has supported the business through a very difficult period and remains committed to the workforce here in the UK and ensuring our lower carbon operations help deliver a sustainable, decarbonised UK steel industry.”
A statement from Liberty said: “Despite the injection of £200 million of shareholder capital over the last two years, the production of some commodity grade products at Rotherham and downstream mills has become unviable in the short term due to high energy costs and imports from countries without the same environmental standards.
“Primary production through Rotherham’s lower carbon electric arc furnaces (EAFs) will be temporarily reduced while uncompetitive operating conditions prevail.
“These actions together with the idling of Liberty Performance Steels in West Bromwich and the reconfiguration of Liberty Steel Newport into a storage, distribution and trading hub, may potentially impact up to 440 roles across the business. The company will consult with employee representatives, trade unions and UK government throughout the process.”
Newport East MP Jessica Morden said the news “again draws attention to the urgent need for a long-term plan for the steel industry – something which we just haven’t seen from the UK government. I will be raising this at the earliest possible opportunity with UK government ministers.”
Aberavon MP Stephen Kinnock, Chair of the All-Party Parliamentary Group on Steel, said: “We all simply must wake up to the importance of the steel industry and its workers. The world will use more steel in the decades ahead than we do today, and in the age of Putin’s invasion and China’s aggression we desperately need steelmaking capacity here in Britain.
“We simply cannot afford to offshore good jobs, our national security and carbon emissions to dirtier steel plants abroad, often controlled by authoritarian regimes that wish Britain harm. We need a Green Steel Deal between government and industry – with action on Britain’s uncompetitive electricity prices – and we need it now. Today’s news is a stark illustration of the cost of the UK government sitting on its hands and doing nothing.”
Source: Read Full Article