'Despite all efforts...': Tata Steel cuts 800 jobs in the Netherlands

On Monday, the Dutch division of Tata Steel announced its intentions to reduce approximately 800 positions at its IJmuiden plant as part of a strategy to enhance profitability. Currently employing about 9,200 individuals in IJmuiden, located roughly 30 km west of Amsterdam, Tata Steel expressed the need for additional measures despite prior efforts to bolster its market standing and cut costs. 

The restructuring will predominantly impact managerial and support staff and is deemed essential for maintaining competitiveness as the Dutch steel plant transitions to more sustainable production methods.

"Despite all efforts by Tata Steel to improve its market position and reduce costs, more needs to be done," the company said in a statement.

"Also in light of the transition to a cleaner company, in which significant investments are and will be made."

Tata's steel facility contributes to approximately 7% of the Netherlands' total CO2 emissions, making it the largest individual polluter in the country. While collaborating with the Dutch government on environmentally friendly steel production initiatives, an agreement on the necessary support has not yet been reached. In its latest proposal, Tata outlined plans to replace coal and iron ore-based production with ovens running on metal scrap and hydrogen by 2030, though financial details were not provided.

Tata Steel reported a whopping Rs 6,511-crore consolidated loss in quarter ended September 30, 2023 hurt by charges related to restructuring at its UK operations and lower sales and price realisations. It reported consolidated net profit of Rs 1,297 crore in the year-ago period.

"We have assessed the potential impact of the EAF-based decarbonisation project and restructuring in UK. We have taken an impairment charge of Rs 12,560 crore in standalone financial statements and Rs 2,746 crore in consolidated financial statements. In addition, we have taken a charge towards restructuring & other provisions of Rs 3,612 crore in consolidated financial statements," Tata Steel had said in a stock exchange filing.

In September, the company struck a 1.25 billion pound deal with the British government to decarbonise its Port Talbot site, which would likely impact 3,000 jobs. The transition to EAF-based steelmaking will result in reduction of 50 mn tons of direct carbon emissions over a decade, said the firm.

With inputs from Reuters