Life after steel?
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For any Industry hit by a sudden collapse In customer demand, diversification is the obvious response. But one problem steel hauliers face is having equipment specifically designed for carrying rolled steel coil and nothing else. Lloyds of Ludlow does more than 50% of its work for Carus, and employs 50 drivers. Transport manager Colin Vickress says a flat-bodied trailer with a well in the middle is standard equipment: "You can't put dried fruit on a steel coil carrier. Unless you splash out on new equipment you won't find alternative work."
He says a steel coil carrier costs 118,000 new, and there is unlikely to be much secondhand demand for them in the present climate.
Cardiff-based Ryan Transport is an example of a haulier which has diversified successfully following the demise of its main customer. In 1998 it carried 3.5 million tonnes of coal a year; last year it was Just 100,000 tonnes. "We have diversified our business into shipping and timber and have nearly got back to the 19m turnover we had in 1997-98," says managing director Tony Davies. He adds that any firm contemplating a similar transition should first ensure it is not saddled with debt: "We were very fortunate in that our fleet was fairly new and we had purchased the vehicles with cash." This meant the company had sufficient resources to acquire other businesses.
Unions and government hope to persuade Carus to reverse at least some of the closure decisions. Although steel union ISTC's proposal to rescue the Llanwern works has already been rejected by Corus, on 14 February it was due to announce a rescue package for the entire UK business. But it Is difficult to see what would work, other than a huge Injection of subsidies or protective trade barriers to reduce competition. Both these solutions would fly in the face of international trade agreements.