Mining equipment manufacturer Sandvik will cut 37 jobs from its New South Wales operations as it battles weaker demand.
“Unfortunately, the continuing decline in market conditions has meant a decreasing order intake for our mining products,” Sandvik Australia country manager Rowan Melrose said.
The company said 25 jobs will be lost when it closes its conveyor component production unit located in Heatherbrae, NSW, relocating operations to Bayswater, WA.
“We deeply regret the impact these decisions will have on the individuals concerned, their families and the Newcastle/Hunter region,” he said.
Melrose said the move is “absolutely necessary” to ensure its components business stays in Australia.
“While the closure of the Heatherbrae conveyor component production unit is a poor outcome for all concerned, the company is in the position where this is absolutely necessary to ensure the continuing viability of our conveyor components business,” he said.
The company said redundancies will be finalised once its voluntary redundancy process is completed.
Weaker conditions across both Australian and global mining sectors will see an additional 12 redundancies made across other production units at its Heatherbrae Hunter Valley Site (HVS) facility.
“Since we announced some redundancies at this site in May 2013, forward orders have slowed further, plus we have seen a further reduction in outbound orders during the year,” Melrose said.
“This means we have no choice but to make these additional changes.”
Sandvik’s existing Bayswater operation currently manufactures the majority of rollers and pulleys for the local Australian market.
Melrose said the company conducted a review of its global conveyor component capacity and decided to consolidate its entire Australian roller manufacturing activities.
“Operating for over 50 years, the Bayswater facility is also our main location for conveyor components engineering, technical and production expertise,” he said.
Melrose said Bayswater has recently been upgraded to improve production efficiency.
“We have made significant investments in equipment, facilities and processes,” he said.
Job losses have been experienced across many of the major mining equipment manufacturers this year.
“Unfortunately, Sandvik is not alone in having to make these difficult decisions, with other suppliers of equipment and services, along with mining companies, announcing employment reductions and facing the same situation,” Melrose said.
Atlas Copco has cut workers, Bradken has cut over 1000 jobs in the past 12 months,Caterpillar has axed jobs, and Outotec also announced in October it will be cutting 500 positions as it seeks to slash $71 million in costs.