French government under pressure to save jobs at British Steel’s plant in France

French officials were under pressure on Thursday to save the jobs of hundreds of French steel workers at factories facing an uncertain future after the collapse of British Steel, whose assets will be sold to pay off its debt load.

French government under pressure to save jobs at British Steel's plant in France
Workers at the French site in Hayange are concerned for their future. Photo: AFP

“We knew something was wrong but not that the situation was as catastrophic as this – it's like a gunshot,” Djamal Hamdani, a union representative at British Steel's plant in Hayange, northeast France, told AFP.

The site, specialising in steel beams, employs some 420 workers, plus additional part-time hires and subcontractors.

It depends on raw steel supplied by British Steel's factory in Scunthorpe, England, one of the sites that could be sold or shuttered after the company was placed in compulsory liquidation on Wednesday.

British Steel's Scunthorpe plant. Photo: AFP

“Scunthorpe's closure would lead to the closure of Hayange and of FNSteel in the Netherlands, pure and simple,” Hamdani's CFDT union said in a statement.

British Steel bought the Dutch factory at Alblasserdam in 2017, when it employed nearly 300 people.

The firm's failure also jeopardises the futures of some 270 workers at the Ascoval factory in Saint-Saulve, northern France, which British Steel pledged to rescue from imminent bankruptcy just a few weeks ago.

The Ascoval site's future has been up in the air since a restructuring carried out by its former owner in 2015, when Emmanuel Macron, then the economy minister, told workers “there will not be any closure of the site, nor any forced layoffs”.

Prime Minister Edouard Philippe said on Thursday that “the game isn't over” despite British Steel's collapse, which he attributed to complications from Britain's looming exit from the EU.

“We knew that British Steel urgently needed to build up its capacity in continental Europe because, being based in the UK, it might not have had access to European clients,” Philippe told CNews television.

The French government provided a €15 million loan for Ascoval and British Steel had provided €5 million, while promising an additional €40 million shareholder loan.

“I'm being very cautious about this, but I'm fairly optimistic. I think we can do this,” Philippe said.   

Finance Minister Bruno Le Maire will meet with Ascoval employee representatives Thursday and with Greybull Capital, British Steel's owner, on  Friday, a CGT union official, Nacim Bardi, told BFM television on Wednesday.

“For now, the most important thing is to meet our main shareholder Greybull,” he said.

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After promising to create 1,000 jobs in France… GE set to cut 1,044

US industrial conglomerate General Electric said on Tuesday that it would cut more than 1,000 jobs, mainly at its gas turbine operations in eastern France, part of a wave of European layoffs as it tries to stem losses in its power generation business.

After promising to create 1,000 jobs in France... GE set to cut 1,044
Photo: AFP
The 1,044 job cuts, long feared by unions, could become a political challenge for President Emmanuel Macron, who assured local officials this month that the government was following the matter with “the utmost vigilance”.
The cuts will be made mainly in Belfort, eastern France, the European headquarters for GE Energy, and in the Paris region, the company said in a statement.
“More than half the number of employees in the gas activities… are going to lose their jobs,” the mayor of Belfort, Damien Meslot, and other local officials said in a statement.
They warned of “a new hardship” for the region, which has been hit hard by the decline of mining and heavy industry over the past decades.

US giant GE to pay France €50 million after creating just 25 jobs out of 1,000Photo: AFP

Overall, GE employs nearly 4,000 people in Belfort, including 1,900 in its gas turbine operations.   

The company has struggled for years with slumping demand for its gas turbines because of low oil and gas prices, and the power operations were a key factor in its massive annual loss of $22.8 billion last year.
In 2015 GE announced 6,500 job cuts across Europe, and two years later it revealed a further 12,000 cuts.
That prompted France to fine the company €50 million earlier this year, since GE had promised to create at least 1,000 new jobs when it announced the purchase of the power businesses from France's Alstom in 2014.
Shortly after closing that deal, GE unveiled a series of job cuts across Europe as slumping oil and gas prices crimped demand for its heavy-duty turbines and other equipment.
The company had already warned last year that it wouldn't meet the target, though the new CEO Larry Culp confirmed in October that GE would “fulfil its commitments.”
It had promised to pay €50,000 for every job not created over the three-year period.