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Thyssenkrupp workers demand clear strategy for steel unit

Thyssenkrupp workers demand clear strategy for steel unit
FILE PHOTO: A logo of Thyssenkrupp AG is pictured at the company's headquarters in Essen, Germany, November 21, 2018. REUTERS/Thilo Schmuelgen -
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Thilo Schmuelgen(Reuters)
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DUISBURG, Germany (Reuters) – Powerful labour leaders at Thyssenkrupp <TKAG.DE> have called on the group’s management to come up with a clear strategy for its steel unit, which will remain part of the conglomerate after a failed attempt to merge it with Tata Steel <TISC.NS>.

“We’re core business now. That requires the need for investments,” Tekin Nasikkol, head of the works council of Thyssenkrupp Steel Europe, told journalists. “We reject pure restructuring plans and tough cost cut programmes.”

Thyssenkrupp’s steel unit has come under pressure due to falling prices and high raw material costs and faces 2,000 job cuts, the same level of layoffs that would have been carried out under the previous merger plans with Tata Steel.

Thyssenkrupp Steel Europe’s second-quarter adjusted operating profit plunged 81% to 37 million euros (33 million pounds).

The elevators-to-submarines group last month scrapped the joint venture plan after it became apparent that the European Commission would block it, causing a u-turn in strategy. Thyssenkrupp now expects to keep a majority in the business in the long-term.

Chief Executive Guido Kerkhoff told Reuters a day earlier that the situation in the steel market remained tough and that there were no signs of a turnaround. “We want to develop the steel business on our own,” he said.

(Reporting by Tom Kaeckenhoff; Writing by Christoph Steitz; Editing by Keith Weir)

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