Hundreds of jobs are at risk at two UK steel plants after owner Tata Steel said it would shut down part of its operation.
Tata said it planned to close its Orb Electrical Steels site in Newport, after looking to try to sell the plant for the last 15 months. The factory produces electrical steel for use in vehicles’ power transmissions, and employs 380 people.
Instead, the UK’s largest steel maker which employs more than 6,000 people in Wales, has said it wants to concentrate on its core production business.
Tata said it has also failed to find a buyer for Wolverhampton Engineering Steels Service Centre, which employs 26 people. This will also close, including a sales office in Bolton.
Tata Steel 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.”
“Continuing to fund substantial losses at Orb Electrical Steels is not sustainable at a time when the European steel industry is facing considerable challenges. We saw no prospects of returning the Orb business to profitability in the coming years.”
‘Yet another blow’ for UK steel industry
The news comes weeks after the government decided on a buyer for Britain’s second biggest steel maker, British Steel, after it fell into administration in May.
The UK steel industry has been in decline for decades, with foreign overcapacity and a glut of cheap Chinese product undercutting the market, as well as economic pressures such as Brexit coming to bear in recent years.
Labour’s shadow business secretary, Rebecca Long Bailey, said: “This is yet another blow to the UK steel industry and the communities that rely on it.
“This government’s reckless no deal policy is hammering manufacturing before Brexit has even happened.
“The government must urgently work with steel unions and industry to implement an emergency strategy for the sector.”
Roy Rickhuss, general secretary of the steelworkers’ trade union Community, said the news made a “mockery” of a jobs guarantee issued by Tata that it would make no compulsory redundancies until 2021.
“This is of course extremely devastating news for the workers affected, but all Tata Steel workers should be concerned by the way Tata is breaking its commitments.
“We are opposed to plant closures and compulsory redundancies and therefore the company should be aware that we will be considering all options, up to and including industrial action, in defence of our members’ livelihoods.
Community called on the government to intervene.
A government spokesperson said: “While this is a commercial decision for Tata Steel Europe, we remain in regular contact with the company, unions and other partners throughout this process.”
All images: Getty