CAPE TOWN - Struggling ArcelorMittal South Africa (Amsa), Africa’s biggest steel producer, has said retrenchments were on the cards amid its proposed plan to restructure the organisation and introduce cost-cutting measures.
“It is difficult to estimate the number of employees who may eventually be retrenched as a result of the proposed restructuring and efficiency measures as this is subject to the outcome of the consultation process and other avoidance measures,” said Amsa’s chief executive, Wim de Klerk. “It is estimated that it is possible that more than 50 employees may be retrenched, which means that this will fall within the ambit of a large-scale retrenchment,” he added.
Amsa said it was exploring cost-cutting measures, including the sale of its non-core assets after previous interventions to turn the business around did not work.
“We do not believe that the outlook is likely to change in the foreseeable future, especially with regards to the lack of investment in infrastructure development,” De Klerk said. Amsa said the restructuring came as the steel industry was under pressure from cheap imports, the volatile exchange rate and rising input costs.