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While the full extent of the Covid-19 pandemic still remains uncertain as the economy slowly reopens under government’s risk-adjusted approach to easing lockdown restrictions, JSE-listed steel producer ArcelorMittal South Africa (AMSA) has advised that it is considering a large-scale restructuring.
A number of jobs may be impacted, but the exact number would be subject to a formal consultation process.
AMSA said on June 18 that it would continue to engage with organised labour and employees to consider alternatives to minimise the impact.
This follows as the various lockdown regulations have, to date, had a material negative impact on the business, and the company anticipates that it will take some time for crude steel production levels to return to historical or planned levels for this year.
This means that a significant part of the company’s available production capacity may remain unused for an extended period and, consequently, cost-saving initiatives previously implemented will not be sufficient.
According to AMSA, the unexpected impact of Covid-19 has led the company to consider further measures to ensure that its cost base is adjusted in line with lower anticipated demand.