Tata Steel Europe to fire 2,500 employees as the company continues to bleed money: Report

Tata Steel Europe, which is a subsidiary of Tata Steel India, is going to slash 2,500 jobs (25% of its manpower), in Europe to salvage $930 million in costs.

Citing a message in a note to its employees, the company stated that Tata Steel Nederland (the Netherlands in English) would have to provide "a large part of this amount or 170 million euros in cost savings".

Tata Steel will downsize across its plants situated in Belgium, England, France and Netherlands, Dutch media outlet NH Nieuws reported on Monday.

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Meanwhile, Dutch worker union Central Works Union has said that it will step in the matter given that the Dutch operations are profitable. "We know that things are not well in the automobile industry and costs for storage are also falling but this was not expected," the media outlet cited the union as saying. The report added that the final plan on job cuts would be ready by November.

Interacting with media on earlier occasions, the Tata Group had hinted towards investments in its India operations while deploying more capex in its Kalinganagar plant in Odisha. Tata Steel India in August said that it may revise the planned capital expenditure for the FY20 (2019-20) to Rs 8,000 crore from Rs 12,000 crore.

Also Read: Tata Steel profit halves to Rs 9,098 crore in FY19, revenue surges 27% on higher volumes, capacity ramp-up

"We have given a guidance that the CAPEX will be 20-25 per cent lower than the original plan between Europe and India (operations). Our original estimate was Rs 12,000 crore for the Tata Steel Group... it will now be around Rs 8,000 crore," Tata Steel CEO and MD T V Narendran had told PTI.

Of the Rs 12,000 crore, the steel major had initially planned to spend around Rs 8,000 crore on India operations. "Both sides (India and Europe) will take a cut," Narendran had added.

Also Read: Tata Steel to cut capex to Rs 8,000 crore in FY20 amid slowdown