Tata announce threat to hundreds of steel jobs could go at Newport plant

tata steel

Hundreds of jobs could go at a steelmaking factory in Newport after its owner announced it was shutting part of its operations.

The steel giant Tata is closing its Orb Electrical Steels base in the Pill area of the city.

Up to 380 jobs could go from the plant, which makes electrical steel used in power transmission.

The company has been for sale since May 2018 as Tata had decided to concentrate on its core steel production business.

Tata Steel’s European operations head Henrik Adam said: “I recognise how difficult this news will be for all those affected and we will work very hard to support them.”

BBC Wales has been told the 380 workers can be redeployed at its Welsh plants.

Unions said Tata – which employs nearly 6,000 workers in Wales – was breaking its commitments over job guarantees.

Orb Electrical Steels is part of Tata’s Cogent division, part of which is being sold to the Japanese steel company JFE Shoji Trade Corporation.

The Orb site makes electrical steel used in generators, transformers, motors and magnetic products, including for the car industry.

But the sector has been suffering from over-capacity over the last 10 years, and struggling to compete in particular with big volume producers in China.

“This business is the smallest volume electrical steel manufacturer in the world – and we’ve only been able to make a profit in two of the last 10 years and no profit in the last four years,” Tor Farquhar, Tata Steel Europe’s HR director, told BBC Wales.

Meanwhile, converting the Orb plant would have cost Tata more than £50m.

Mr Adam added: “Continuing to fund substantial losses at Orb Electrical Steels is not sustainable at a time when the European steel industry is facing considerable challenges.”

Roy Rickhuss of the Community steelworkers’ union called it “shocking” news which “makes a mockery of the understanding we reached with Tata around the jobs guarantee”.

“There has been no consultation about this proposal either at UK or European level and company management should hang their heads in shame in the way this has come about,” he said.

“This is of course extremely devastating news for workers at the Orb, but all Tata Steel workers should be concerned by the way Tata is breaking its commitments.”

He called for government intervention.

One of the plant’s union officials Paul Horton, who has nearly 37 years experience, said it would mean a loss of well-paid jobs in the area, with workers earning up to £40,000, with overtime on top.

“We weren’t expecting anything this severe, this quickly,” he said. “We understand the business has been struggling but there has been no inkling of this happening over the last few weeks.”

Unite’s Tata official Tony Brady said Orb’s closure would be a “body blow” for the economy of Wales.

“Unite will be fighting for every job and holding Tata Steel’s feet to the fire over assurances that workers affected by today’s announcement will be redeployed.”

He said the union would not sit back and allow “decent well-paid jobs and irreplaceable skills to go to the wall”.

Mr Adam said workers would be offered alternative employment at other Tata sites where possible and consultations with staff and unions would start shortly.

Tata is also closing its Wolverhampton Engineering Steels service centre, with up to 26 jobs at risk.

There has been steelmaking on the Newport site since 1898, when the old Lysaght company moved from Wolverhampton.

The famous city landmark, the transporter bridge, was built to carry workers across to the works.

It eventually became part of British Steel and then European Electrical Steels in 1991.