Finnish steelmaker Rautaruukki has announced its intention to adjust steel production and other operations in line with demand and stock levels. These steps to improve efficiency aim at permanent cost savings of €60 million annually.
In the context of adjustment and efficiency measures, Rautaruukki is to start employer-employee negotiations about possible layoffs, redundancies and part-time work in different market areas. Group-wide, the company estimates it needs to reduce its workforce by around 1,000, including 520 jobs in Finland, mostly within the steel business and at its steel service centers.
In order to adjust steel production, Rautaruukki is to temporarily shut down one of its two blast furnaces at the Raahe Works in Finland, to cut back output at Ruukki Production's units in Finland and also at Ruukki Metals steel service centers, while its Ruukki Construction division is to adjust production and sales operations mostly outside Finland. Ruukki Engineering division will align production with demand at the Mo i Rana unit in Norway and at the Kurikka plants in Finland.
On the other hand, Rautaruukki's and business support functions continue to implement actions under the Boost program launched in October this year.Within the framework of the program, Ruukki Production is to reduce the number of shifts, while Ruukki Construction is to centralize construction product manufacture in the Baltic States in Estonia, and by the end of April 2009 is to close its small profiling units in Riga, Latvia and in Vilnius, Lithuania. Moreover, during Q1 of 2009, Ruukki Engineering is planning to transfer production in Hungary from the Hatvan site to the components plant in Jászberény, while by the end of June 2009 Ruukki Metals intends to close the steel service centre in Tampere, Finland and to focus parts processing on Raahe and Seinäjoki.
The company expects the 2008 operating profit to remain at the 2007 level.