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Home / Business / Tata: Hundreds of steel jobs could go on the Newport Orb plant

Tata: Hundreds of steel jobs could go on the Newport Orb plant



  Cogent in Newport

Caption

Up to 380 jobs can be lost at the facility

Hundreds of jobs could go at a Tata steel mill in Newport.

There has been a factory on site since 1

898, but the Orb Electrical Steels have not had profits for the last four years.

Up to 380 jobs could go, although Tata hopes to offer jobs elsewhere in Wales.

The factory, which produces electric steel used in power transmission, was put up for sale in May 2018, with Tata intending to concentrate on its core steel business. [19659005] Tata Steel's European operations manager Henrik Adam said: "I am aware of how difficult this news will be for all concerned, and we will work very hard to support them."

The unions said Tata – which employs nearly 6,000 workers in Wales – was breaching its obligations over job guarantees.

Orb Electrical Steels is part of Tata's Cogent division, where a portion is sold to Japanese steel company JFE Shoji Trade Corporation.

Tata also closes the Wolverhampton Engineering Steel service center, with up to 26 jobs at risk.

Caption

Tata said it would have cost £ 50 million to upgrade the Orb site to make it competitive

The Orb website makes electric steel used in generators, transformers, motors and magnetic products, including for the automotive industry.

But the sector has suffered from overcapacity for the last 10 years and has struggled to compete especially with large volume producers in China.

"This business is the world's smallest electric steel producer – and We have only been able to make two in the last 10 years, and no profits over the last four years," said Tor Farquhar, Tata Steel European HR Director, for BBC Wales.

Meanwhile, rebuilding the Orb plant would cost Tata more than £ 50m.

Adam added: "Continuing to fund significant losses on Orb Electrical Steels is not sustainable at a time when the European steel industry is facing significant challenges."

But he said workers would be offered alternative employment on other Tata – places in Wales where possible and consultations with employees and unions would start shortly.

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Paul Horton, a Community trade union at the facility, said there had been an agreement on no mandatory job losses until 2021

WORKERS & REACTION

One of the factory's union officials, Paul Horton, who has nearly 37 years of experience, said it would mean a loss of well-paid jobs in the area, with workers earning up to £ 40,000, with overtime on top.

"We didn't expect anything so serious, this quickly," he said. "We understand that the business has struggled, but nothing has happened about this that has happened in recent weeks."

Caption

Jason Sims, Matthew Grande and Paul Spencer have 55 years of experience with Orb.

Jason Sims, who has worked at the facility for 13 years, said: "It's sad news. Everyone is in a bit of a shock right now and trying to take it in."

He said there was a lot of uncertainty about whether there would be offers for work in Port Talbot or Llanwern.

Matthew Grande said that news had been leaking since Sunday, and they had to work with a "massive cloud hanging over our heads. We are devastated and broken to be honest with you."

He said it was like a family business, with everyone knowing each other and "more or less growing up together."

Paul Spencer, with 22 years at the facility behind him, said he hoped there would be jobs by the end of it. "Rumors have been going on and off for about 12 months, but when you go to the meeting this morning, it really is, your stomach is sinking."

Caption

Orb was privatized from British Steel 30 years ago

UNION REACTION

Unites Tata official Tony Brady said that Orb's closure would be a "body blow" to the economy of Wales.

"Unite will fight for any job and keep Tata Steel's feet on fire over assurances that workers affected by today's announcement will be redeployed."

He said the union would not sit back and let "decent, well-paid jobs and irreplaceable skills go to the wall".

Roy Rickhuss of the Community steelworkers' union called it "shocking" news that "mocks the understanding we gained with Tata about the work guarantee."

"There has been no consultation on this proposal either in the UK or at European level and corporate governance should be ashamed of the way this has happened," he said.

"This is of course extremely devastating news for workers at Orb, but all Tata Steel workers should be concerned about the way Tata is breaking their obligations."

He requested government intervention.

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Reg Speller / Getty Images

Caption

The Newport transport bridge was opened in 1906 to help workers reach the facility

A LONG HISTORY

There has been steel production on the Newport side since 1898, when the old Lysaght company relocated from Wolverhampton.

The famous city landmark, the conveyor bridge, was built a few years later to carry workers over to the works.

It eventually became part of British Steel and then European Electrical Steels in 1991.

Cogent took over in 2001.

Analysis by Brian Meechan, BBC Wales business correspondent

There have been concerns about the future of the Tatas Cogent operation for a few months, ever since it went on sale.

Cogent was put up for sale by Tata in May last year after the Indian owners decided to concentrate on their nuclear steel production business, as it planned to merge with the German company Thyssenkrupp.

Given Cogent's specialism, it was hoped that a buyer could be found, but unions then said they were not persuaded by the case for sale.

They had become increasingly concerned in private. about the future of the plant. This decision could put Tata and the unions on an even larger collision course.

As part of the unions' agreement to support less generous pensions, they believe Tata committed to no mandatory layoffs until 2026.

Tata has always maintained that it committed to trying to avoid mandatory layoffs.

The unions could see this as breaking a commitment to the entire Welsh workforce, and industrial measures could be possible, they say.

THE POLITICAL RESPONSE

Economy Minister Ken Skates said he emphasized the importance of talks with the company to avoid mandatory layoffs.

"The Welsh Government will now do everything it can to support individuals, the community and the supply chain affected by this announcement," he added.

"Today's news clearly shows the fragility of the global steel market, and the UK Government must now expand and expand its approach to supporting the industry, including the supply chain, across the UK."

The British Government said that it was in regular contact with the company, trade unions and other partners, and took "comprehensive measures to support the industry."

A spokesman said: "We have a long and proud history of outstanding steel production, and the UK government is concerned about to support a modern and vibrant steel sector. "

Newport East MP Jessica Morden said job loss would be" devastating news "for workers and families.

"What is particularly tragic is that this, the only UK facility that has the potential to produce electric steel for engines and with its investment, vision and support, may be the most important part of the electric vehicle supply chain," she said .

Plaid Cymru & # 39; s finance spokeswoman Rhun ap Iorwerth AM said the closure was "devastating" and that he wanted the Welsh and British governments to investigate all possible interventions.

"I have repeatedly called for a major summit on Wales's economic future," he said.

"This is further evidence of why it is more important than ever to have a clear focus on the threats we face, and the opportunities that must be sought at this time with unprecedented uncertainty."

Conservative Commerce Secretary Russell George AM, called the news "incredibly disappointing" and "a terrible blow to the region and its supply relations."


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