Ampco-Pittsburgh Corporation and its subsidiary Union Electric Steel Corporation issued a Worker Adjustment and Retraining Notification (WARN) Act notice to employees at the Åkers National Roll Co. plant in Avonmore, PA, indicating plans to temporarily idle some operations there due to “continued challenging global market conditions.”
The WARN Act requires employers to provide a 60-day notice of idling or layoff measures, meaning that the Åkers National Roll operation is expected to begin scaling back in January 2017. It’s not clear how many workers are affected, nor how long the idling may continue.
“Union Electric Steel is restructuring its global cast roll operations to be more competitive in current market conditions,” according to Rodney Scagline, president of Union Electric Steel.
The scope of the restructuring — or “consolidation,” another term used by Scagline in the statement — is not known.
Cast rolls are produced by centrifugal castings, heat treating, and finish machining large steel ingots, for use as mill rolls or back-up rolls, installed in rolling mills for steel, aluminum, and other metals. Demand for mill products has been weak for much of the past two years, and the Ampco-Pittsburgh statement confirmed “cast roll demand in 2016 has continued to decline, resulting in low utilization rates at our cast roll manufacturing plants.”
Ampco-Pittsburgh completed its acquisition of the Swedish firm Åkers AB earlier this year, in the process acquiring not only the Avonmore plant but mill-roll operations in in Sweden, Slovenia, and China. It also acquired Åkers’ Vertical Seal Co. in Pleasantville, PA, a producer of bearings, bearing sleeves, bushings, and rolling mill components.
At that time, Ampco-Pittsburgh already owned Union Electric Steel, in Carnegie, PA, which is among the world’s largest integrated producers of forged hardened steel, cast iron, and cast steel mill rolls, with plants at Valparaiso, IN; Burgettstown, Carnegie, and Erie, PA; and Gateshead, England. (UES also produces ingot and open-die forged products for oil-and-gas exploration and aluminum and plastic extrusion.)
In announcing the upcoming idling to employees, and to union and government officials, Scagline said “Åkers National Roll has been especially challenged due to a high cost structure, made worse by a strong U.S. dollar. We believe that consolidation of operations will improve overall plant utilization and our financial performance.”
Scagline added that the company is working the United Steelworkers union to explore “other restructuring possibilities” that might minimize job losses.
“We regret that these decisions are necessary to bridge this period of extremely challenging market conditions,” stated John Stanik, CEO of Ampco-Pittsburgh.
In a separate move, agreed to buy ASW Steel Inc., Welland, Ontario, for approximately $13.1 million, including $3.5 million in cash and assumption of approximately $9.6 million of debt. ASW is a primary producer of carbon, stainless, and specialty steel, with AOD, VOD, VD, and LMF refining capabilities for numerous aerospace, energy, engineering, and industrial manufacturing requirements.