Thursday, March 12, 2009

Severstal to cut up to 9,500 jobs in Russia

Severstal,, Russia's largest steelmaker, said it planned to cut 9,000-9,500 jobs at its Russian steel facilities in response to weak demand, and would also make layoffs at its coal and iron-ore mines.

Russian steel makers joined global rivals in reducing output during the fourth quarter, though they have thus far refrained from significant layoffs because of the politically sensitive nature of such a move.

Chief executive Alexei Mordashov told reporters on Wednesday Severstal was also drafting an action plan to reduce its U.S. costs and that this would involve redundancies too.

Additional workforce reductions are also planned at its Russian coal and iron ore mining operations, Mordashov said.

Severstal, majority owned by Mordashov, first announced a job-cut programme in November but declined to provide detail on how many of its more than 100,000 employees could go.

Mordashov said some of the 9,500 jobs had already been cut, while other jobs would go in the first half.

Severstal has cut output at a range of facilities in Russia, Italy and the United States over in recent months as steel demand slumped, reporting in February that fourth-quarter crude steel production fell 48 percent from the third quarter.

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