RIO Slashes 14,000 jobs

[Gee Cee]

Port Kembla

Blue Scope Steel are cutting contractors.
Eg Transfield Etc.
Cutting Shifts.
Getting people to take leave. Etc/etc

6 months ago everyone was working 3 shifts PLUS Overtime .


How quickly things change

NO Orders = No Need For Workers, or coal or iron ore or shipping or transport or gas supply or large electricity supply or staff canteen. (LIST GOES ON )

Hopefully this will improve early 2009

 

[joeExpat]

that's about 750 full time people per country (roughly) for every country that RIO operates in. i think BankWest cut more job than that out of WA!

wow - that'll have a huge effect on property prices!

More like around 3000 from Australia if proportional to the number of employees, most of these concentrated in certain areas. I think yes with other companies cutting back as well it will have a huge impact on mining town property prices which have bubbled in recent years.

 

[Aaron Sice]

okay so 3000 from aus.....whatever....someone cry me a river already.

 

[grossreal]

hi all
maybe a good time to start to go into the timber business
to sell the lengths of timber to board up the houses in these mining towns
sounds like they will be closing down mt isa and karratha.
give me break
talk about feel a few drops and people think its going to be a flood.
for me you should buy not where there is a mine
but where there is going to be a mine
but thats me.
but correction in the commodity price has always been there but because everyone has the gitters its that this will correct syd prices.
it will but for me less then .0001%
our market has more of a problem for over leveraged, margin loans and banks or funders going under and they have not alot to do with commodities except if they leveraged on the back of them and thats their fault not the commodities
not sure with melb but syd for me has alot onthe market because of funder and margin calls and there will be more and for me the pain has not started.
but the one ray of light I see is commodities
as they bounce back justas much or more as demand comes back and for me it will.
so I will sell the timber but also buy the house to take away the vendors pain in the mining towns if they want

 

[lizzie]

onesteel are shedding to (200 in whyalla gone, from a town of 32,000). but a good portion of that comes from the smorgan merger where they ended up with double staff in many positions.

i gather a few bhp affliated service companies in wa are dumping staff because bhp aren't renewing contracts or putting in orders for work/goods.

i wonder how much is also due to the expected carbon trading costs. i know that the lead smelter in port pirie (pop approx 23,000) is seriously considering closing, and moving all their production to their tassie smelter, because the carbon trading cost will make port pirie unviable.

if so, that will be the death of the town, because the smelter is the core business ... like closing a mine near a mining town.

 

[lowell]

okay so 3000 from aus.....whatever....someone cry me a river already.

The denial speaks volumes

 

[chilliaa]

Yes but it does highlight the risk of buying in regional areas.
During the good times people do not sufficiently adjust for the underlying risks in investing in these areas.

 

[Ausprop]

They also under rate the returns. Karratha has way outperformed any city for the last 20 years - long enough to pay off a mortgage... not that you would need to with the inflation erosion of the debt anyway. And I don;t see that changing for a long long time.

 

[BoatBoy]

Get rid of a few staff, dig a bit less out and they may be able to get ships moving on time instead of waiting for 14 days on anchor for their turn at the wharf.

Dave

 

[Aaron Sice]

They also under rate the returns. Karratha has way outperformed any city for the last 20 years - long enough to pay off a mortgage... not that you would need to with the inflation erosion of the debt anyway. And I don;t see that changing for a long long time.

i still see the demand in Port Hedland and Karratha - it's not going to go away any time soon.

yields just might soften a little - but when you're pulling in 14+% yields - who's baulking?

 

[Aaron Sice]

The denial speaks volumes

i hope it does.

 

[natmarie73]

Alcan had over twice as many employees as Rio did before the takeover and this is where the majority of job losses will come from IMO. There are a lot of Alcan owned businesses in North America and Europe that were always going to be divested by Rio because they didn't suit Rio's business plan eg downstream aluminium products other than refining and smelting. I would be very surprised if there are very many job losses in Rio's Energy and Iron Ore assets at all and certainly not enough to cause mining town house prices to collapse.

Still very happy to have sold my Rio holding at $100.00+ though.

As for Brisbane house prices, I wish they would hurry up and start falling so I can buy something!