Doubts have been cast over thousands of jobs across the country as Tata Steel has confirmed it is selling its UK assets. The company employs hundreds of people in the West Midlands alone. The decision was confirmed following a lengthy board meeting in Mumbai.
In January, Tata announced more than 1,000 roles nationwide would be axed and said it couldn’t at the time rule out further job cuts at the major Steelpark distribution centre where most of the company’s 600 Black Country workers are employed.
Tata said it has suffered “asset impairment” of more than £2 billion in the last five years.
In a statement, Tata said it noted with “deep concern” the deteriorating financial performance of its UK subsidiary in the last year.
"While the global steel demand, especially in developed markets like Europe has remained muted following the financial crisis of 2008, trading conditions in the UK and Europe have rapidly deteriorated more recently, due to structural factors including global oversupply of steel, significant increase in third country exports into Europe, high manufacturing costs, continued weakness in domestic market demand in steel and a volatile currency.
"These factors are likely to continue into the future and have significantly impacted the long term competitive position of the UK operations in spite of several initiatives undertaken by the management and the workers of the business in recent years."
The firm confirms reports that it is still in talks with investment firm Greybull Capital over the sale of its long products division which makes steel for use in construction.
Tata said the board unanimously concluded that a plan aimed at saving plants was unaffordable, and that it had been in “deep engagement” with the UK Government in recent months in an attempt to seek support to achieve the best possible outcome for the UK business. Tata said it would “explore all options for portfolio restructuring, including the potential divestment of Tata Steel UK, in whole or in parts.”