Lakshmi Mittal asks Kazakhstan's employees to hunker down

Last week Indian billionaire Lakshmi Mittal came to Kazakhstan for a meeting with ArcelorMittal Temirtau plant top and mid ranking managers. He criticized their work and called them to put more efforts into making the production more cost efficient Tengrinews reports citing Novyi Vestnik Karaganda. During the meeting in Temirtau, a town near Karaganda city in central Kazakhstan, the tycoon said that he would continue investing to the Kazakhstan branch only if the plant became more profitable. He pointed out that ArcelorMittal Temirtau was still unable to pull out of the crises that world economy plunged into in 2008. "We can't afford any improvements until you learn to save money and start making money," he said. According to the businessman, foreign competitors of Kazakhstan's ArcelorMittal, an integrated steel and mining company, have no expenses on railway transportation of their goods. That is why he wanted to further reduce the cost of Kazakhstan goods to be more competitive. "I have looked through your business plan for 2014, and I consider it unacceptable. With the business plan like this you can't generate enough revenues even to stay afloat, let alone make any new investments… I have seen that through a joint effort you have found a way to save 150 million. This is an excellent idea, but that is not enough," the billionaire said. He brought up his American enterprise in Cleveland as an example: the plant has a similar production capacity as the one in Kazakhstan, by "only" 1500 people are working there", Mittal said. That is why he believes that the number of jobs at ArcelorMittal Temirtau plant should be cut "where people are not really necessary". "We all understand that the market situation is very difficult, and we should all hunker down and cut costs at every turn. We must understand that we can't afford excess expenses now. Every single should be made aware of this, so that everyone understands what our company is focusing on," Lakshmi Mittal said. The representatives of Zhaktau Steel Workers Union who were invited to the meeting opposed the job cutting. "The analysis shows that we are getting less young people every year. Steel workers job is not longer a prestigious one. Last year our steel workers were in the 2nd place by wages among mining enterprises in Kazakhstan, but now we have moved down to the 7th place. We are offering to give our community a sense of stability in these hard times, because all we care about right now is who is going to be axed next. We should stop this thoughtful flow of job cuts and reorganizations," chairman of the trade union Viktor Schetinin said. Deputy chairman of Korgau coal workers' union Alexandr Polyakov said that the calls made by Lakshmi Mittal were most likely linked to the recent deal of Arcelor Mittal and Nippon Steel & Sumitomo Metal Corporation to purchase American steel refinery ThyssenKrupp Steel for $1.5 billion and the expenses that Lakshmi Mittal had to incur in relation to his niece’s wedding that cost him $80 million, according to media reports. "Of course, our lifestyle is very different and such expensive family events are alien to us. But on the other hand, asking us to forget about adjustment of our salaries for inflation after this is blasphemy," Polyakov said. He added that the monthly wages of the whole coal department of ArcelorMittal made $18 million. Lakshmi Niwas Mittal is a London-based Indian steel magnate. He is the chairman and CEO of ArcelorMittal, the world’s largest steel-making company. Mittal owns 41 percent of ArcelorMittal and holds a 34 percent stake in the Queens Park Rangers F.C. football team. He was ranked the sixth richest person in the world by Forbes in 2011, but dropped to 21st place in 2012, due to having lost $10.4 billion the previous year. In spite of the drop, Forbes estimates that he still had a personal wealth of US$16 billion in October 2012. He is also the 47th "most powerful person" of the 70 individuals named in Forbes' "Most Powerful People" list for 2012.