Tata Steel announced it will initiate statutory consultation as part of its plan to transform and restructure its UK business. This plan is intended to reverse more than a decade of losses and transition from the legacy blast furnaces to a more sustainable, green steel business.
The transformation would garantee most of Tata Steel UK’s existing product capability and maintain the country’s self-sufficiency in steelmaking, while also reducing Tata Steel UK’s CO2 emissions by 5 million tonnes per year and overall UK country emissions by about 1.5%.
Key Highlights:
- The plans follow comprehensive discussions with the UK multi-trade union representative body (UK Steel Committee) and its advisors, in which Tata Steel carefully considered their endorsed proposal for maintaining a single blast furnace
- Having considered that proposal, Tata Steel has planed to adopt elements of it, but considers that continued blast furnace production is not feasible or affordable
- Tata Steel will now begin statutory consultation on the proposed restructuring plan and support arrangements for affected employees
- Up to 2,800 employees are potentially affected, out of which around 2,500 roles would be impacted in the next 18 months
- The company will endeavour to maximise voluntary redundancies and suggests to commit in excess of £130 million to a comprehensive support package for affected employees, including redundancy terms, community programmes, skills training and job-seeking initiatives
- This is in addition to the £100 million funding for the Transition Board set up with UK and Welsh governments to support affected employees, contractors and communities
- Port Talbot’s two high-emission blast furnaces and coke ovens would close in a phased manner with the first blast furnace closing around mid-2024 and the remaining heavy end assets would wind down during the second half of 2024. The proposal also includes a wider restructuring of other locations and functions across the company, including the intended closure of the Continuous Annealing Processing Line (CAPL) in March 2025
- In exchange with the UK Steel Committee, Tata Steel has agreed that it would continue to operate the hot strip mill through the proposed transition period and in future. In addition, the downstream and steel processing centres would continue to serve customers by utilising imported semi-finished steel from Tata Steel plants in the Netherlands and India as well as other select strategic suppliers.
