On Monday, Tata Steel has announced to slash up to 3000 jobs in Europe, as it restructures operations followed by the collapse of a planned merger.
The announcement was made after weeks of conjecture that the India-based steel giant, which offers employment to 11000 workers in the Netherlands, would slash thousands of jobs to approach structural challenges and weaker demand for steel from Europe, which is affected by the US-China trade conflict.
Tata Steel has offered employment to nearly 20000 workers across the continent.
Hence, there was one way to enhance its finances was to cust costs of employment, which meant “an estimated reduction in employee numbers of up to 3000 across Tata Steel’s Europe operations,” said its European-unit in a statement.
It continued that around two-thirds of the cut would probably affect administrative posts.
Tata Steel further stated that “stagnant EU steel demand and global overcapacity have been compounded by trade conflicts which have turned the European market into a dumping ground for the world’s excess steel capacity.”
“Together with a significant increase in the cost of emission allowances, this has created an urgent need for improvements to the company’s financial performance,” it added.
Its announcement follows the subside in May of a proposed merger with the German industrial conglomerate Thyssenkrupp objected at dealing with a surge in Chines-based steel.
After the EU has made it very clear that it wouldn’t permit the merger on competition grounds, both called off talks.
Thyssenkrupp finally announced plans to cut off 6000 jobs, mainly in Germany, and registered a complaint at an EU court against the European Commission for limiting the merger plan.