Corus has announced the closure of several of its UK steel plants as well as a host of layoffs as the result of continuing high losses.
Corus’ carbon steel operations incurred an operating loss of £301million in the nine months to 1 July 2000, mainly due to weak UK demand and lack of competitiveness in export markets.
The company said that, as a result, and despite of the support and commendable track record of its UK workforce, significant job reductions would have to take place.
The company’s proposed measures will result in the reduction of over 3 million tonnes of iron and steelmaking capacity in UK flat products, together with the closure of certain mills and process lines.
This will be accompanied by actions to simplify and streamline process flows in other operations.
The restructuring will result in the closing of iron and steelmaking operations in Llanwern, the closure of the annealing and tempering facilities, and a reduction in activity levels at the hot strip mill and cold mill operations.
The Ebbw Vale site will close.
The pickle line, cold mill and one electro-zinc line at Shotton will also close.
So will the coil plate mill at Teeside.
And the Bryngwyn site.
The annealing and tempering facilities at Shotton and the pickle and galvanising lines at Port Talbot, which were mothballed in Autumn 2000, will also be closed.
The changes will be completed during 2001, with the exception of the closure of Ebbw Vale which will be completed by mid-2002.
These measures will lead to reductions in manning of 3,000. The scores read as follows: Llanwern: 1,340, Ebbw Vale: 780, Shotton: 319, Teesside: 234, Bryngwyn: 127 and Strip Products central functions: 200.
Further job reductions of 3,050 will also be implemented across other business operations.
The business head offices of Construction and Industrial and Engineering Steels will be amalgamated. Together with shared services across the two businesses, this will lead to 400 job reductions.
There will also be a range of job reductions across businesses. Construction and Industrial business will lose 1,086, Engineering Steels 390, Tubes 298, European Market Unit 292, European Electrical Steels 276, Special Profiles 46, Special Strip 35 and Rail 27.
The streamlining of central functions, including the Corporate Centre will involve 200 job reductions.
These measures will be implemented during 2001-2003, and when completed, Corus’ manning in the UK will be some 22,000.
Full consultation will take place with the relevant Trade Unions and a comprehensive counselling service will be provided to assist all employees who are affected.
UK Steel Enterprise Limited, Corus’ job creation arm in the UK, will be fully involved in helping to alleviate the social impact of the restructuring and the consequential manpower reductions.
But there was some good news. In contrast to the steel business, the company said, good progress has been made in the aluminium and stainless steel businesses since the merger in October 1999.