Indian-owned Anglo-Dutch automotive steel supplier Corus on Monday said it was axing about 3,500 jobs worldwide with 2,500 to go here in the United Kingdom.
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A spokesman said, however, that the cuts were not specifically auto-related and, though the company had been affected by the downturn in the UK auto industry, they were part of an ongoing strategic review.
Corus said in a statement a series of measures would “improve its competitive position”. The measure will include divestments, asset restructuring and a company-wide efficiency and overhead review.
In the last quarter of 2008 Corus took measures expected to yield about GBP600m in cash in the six months to the end of March.
The measures included additional training for employees experiencing temporary shortages of work.
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By GlobalData“The company will continue to discuss with employee representatives options to match payroll costs with the new production and demand levels,” the company said.
Corus said its latest measures “should bring annual improvements in operating profit of more than £200m [but] will also put around 3,500 jobs at risk around the company as a whole”. Current payroll is about 42,000 with 24,000 of those in the UK.
The company hopes to achieve the job losses through voluntary redundancies, while retaining critical skills, and plans to offer a range of redundancy and outplacement support packages.
Corus CEO Philippe Varin said: “The structural changes we are proposing today have been carefully considered. They are essential for the future of the business. The company will keep its focus on priority areas such as training, research and product development, which, together with today’s initiative, will ensure Corus is in the best possible shape to compete strongly in the future.”
Restructuring and plant mothballing in the UK would see 2,500 jobs lost in the UK with the remainder in continental Europe.
Corus has been hit by the downturn in the automotive and construction industries, which make up around 50% of the demand for its products. It told Reuters its order book is currently 30-40% lower than this time last year.
Global crude steel production slumped 24.3% year on year in the last quarter of 2008 as major firms cut back on output, Reuters noted.
