Friday, November 23, 2012

News: Tata Steel restructure in Rotherham

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Tata Steel, the Indian-owned steelmaker, has announced a restructure of its UK operations that would result in £2.7m being invested in Rotherham but over 100 local jobs at risk of redundancy.

The main proposal is the restructuring of management and administrative functions which would lead to the loss of 500 jobs at Tata Steel's Port Talbot-based production hub in South Wales.

The company is also proposing to make changes at a number of steel finishing and processing sites in the UK which includes its Bar business in South Yorkshire.

The restructuring follows a significant decline in demand for bar steel products in a number of key markets, including automotive, bright conversion and bright bar. As a result of this reduced demand, Tata Steel is proposing to reduce its production and shift levels which will lead to the loss of 135 jobs, including 110 in Rotherham.

In addition to cutting costs, last month, Tata Steel Europe outlined a new strategy to target demanding industries, like automotive, aerospace, mechanical engineering and construction.

Its Bar business will now focus on supplying hi-tech products to advanced manufacturing sectors and to support this strategy, Tata Steel is investing a further £2.75m in the Rotherham-based business.

Proposals also include an increase of 11 jobs at a distribution hub in South Yorkshire.

Investment in 2005 saw the Rotherham site at Aldwarke become the focus for steel making, casting and rolling of specialist steels. The steel is manufactured at the Rotherham site before undergoing further refining at the Stocksbridge plant or the Thrybergh Bar Mill to improve the quality.

Tata Steel's Bar business will now be integrated into its Speciality Steels business, as part of the changes.

A recent £6.5m investment in aerospace steel production has boosted output of these steels by 30% and safeguarded the South Yorkshire jobs.

Mark Broxholme, managing director of Tata Steel's Speciality Steels and Bar business, said: "These proposed changes are a critical part of developing a sustainable and competitive Bar business.

"Tata Steel is showing its commitment to making this strategy work by committing £2.75m of investment for the Bar business. We are investing in improvements to our steelmaking in Rotherham as well as to the final quality of our products.

"Over the coming weeks, our priority will be to help our employees through this difficult process and keep them up to date with the changes. We will do everything we can to provide them with support and assistance."

The process of consultation with Tata Steel employees and their representatives will begin today. Together, they will look for ways to limit potential redundancies.

The last major restructuring saw the company announce that 1,100 jobs would be lost in Rotherham in 2009. Tata Steel employs 2,200 people at its Specialty Steels and Bar business in the UK, including 1,050 in Rotherham.

Tata Steel Europe website

Images: Tata Steel

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