 "Thousands of Tata Steel UK staff fear rejection of rescue plan")
Thousands of workers at Britain’s largest steelmaker, Tata Steel, fear the firm might fail to revive the ailing Port Talbot plant, with its parent company in India preparing to vote on a turnaround plan this month, according to a media report.
Executives will vote on a turnaround plan on March 29 that will require a fresh cash injection of about £100 million ($144 mn), The Telegraph reported.
Port Talbot executives drew up the strategy, together with colleagues at Tata’s European operations, after the 1,050 redundancies it announced in January. The turnaround plan envisages Port Talbot, with more than 4,000 workers, moving from £200 mn a year losses to a profit of £100 mn within two years, the report said on Saturday.
However, staff believe they are being “set up to fail”, amid fears that they will only be given a year to turn around the plant, too short a time to get back into the black.
Tata’s board was not expected to approve fresh investment, the report said.
The strategy for the survival of the so-called strip business is understood to target £350 million of savings and cost improvements, including mothballing one of Port Talbot’s blast furnaces, as well as pay cuts.
There were also concerns about how the case for pumping further money into Port Talbot would be presented to the board in India at the meeting, the report said.
Tata has invested about £3 billion into its European steel operations since buying these from Corus for £6.7 billion in 2007. However, since then, the steel industry has slumped on falling demand and global overcapacity. Imports of cheap Chinese steel have also hit hard.
There have been calls for the government and the EU to impose stiff tariffs on Chinese imports. Tata recently took a £850 million writedown on its UK operations.
“We have accepted previous turnaround schemes and the jobs losses they included because there was a future at the end of them. Now it looks like we are taking more job losses and more pain with no chance of a future at the end of them. All we want is the board to show confidence in us by not making a decision that will condemn Port Talbot and give us the chance to achieve the turnaround,” a senior Port Talbot employee told the paper.
Executives will vote on a turnaround plan on March 29 that will require a fresh cash injection of about £100 million ($144 mn), The Telegraph reported.
Port Talbot executives drew up the strategy, together with colleagues at Tata’s European operations, after the 1,050 redundancies it announced in January. The turnaround plan envisages Port Talbot, with more than 4,000 workers, moving from £200 mn a year losses to a profit of £100 mn within two years, the report said on Saturday.
However, staff believe they are being “set up to fail”, amid fears that they will only be given a year to turn around the plant, too short a time to get back into the black.
Tata’s board was not expected to approve fresh investment, the report said.
The strategy for the survival of the so-called strip business is understood to target £350 million of savings and cost improvements, including mothballing one of Port Talbot’s blast furnaces, as well as pay cuts.
There were also concerns about how the case for pumping further money into Port Talbot would be presented to the board in India at the meeting, the report said.
Tata has invested about £3 billion into its European steel operations since buying these from Corus for £6.7 billion in 2007. However, since then, the steel industry has slumped on falling demand and global overcapacity. Imports of cheap Chinese steel have also hit hard.
There have been calls for the government and the EU to impose stiff tariffs on Chinese imports. Tata recently took a £850 million writedown on its UK operations.
“We have accepted previous turnaround schemes and the jobs losses they included because there was a future at the end of them. Now it looks like we are taking more job losses and more pain with no chance of a future at the end of them. All we want is the board to show confidence in us by not making a decision that will condemn Port Talbot and give us the chance to achieve the turnaround,” a senior Port Talbot employee told the paper.