Fortescue axes hundreds of jobs in green retreat
Hundreds of green energy jobs have been axed by mining giant Fortescue Metals Group as the company rows back on its ambitious renewable targets.
Mining giant Fortescue Metals Group is set to axe hundreds of jobs across its UK and Australian operations, as the company shifts its focus to outsourcing manufacturing to China and Germany.
The move comes as Fortescue drastically scales back its ambitious plans to build renewable batteries in-house for its mining trucks and equipment.
The sweeping job cuts will hit Fortescue Zero, the company’s green energy division, with at least 200 of the unit’s 1100-plus workforce expected to be let go.
The division, which was once a cornerstone of Fortescue’s push into green energy, is now facing significant downsizing as the company retreats from its earlier lofty goals.
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Fortescue has committed to converting its mining fleet from diesel to electric in a bid to decarbonise its Pilbara iron ore operations by 2030 — a target that far outpaces its competitors.
However, the company’s founder and executive chairman, Andrew Forrest, has revealed that most of the components for the zero-emission trucks will now be manufactured overseas.
“It’s senseless to compete (with the Chinese),” Mr Forrest told The Telegraph.
“We’re building up our research in Oxford, but we’re making sure that manufacturing is done wherever it’s most efficient.”
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The decision will see Fortescue Zero abandon most of its manufacturing activities in the UK, with its Oxfordshire site pivoting to focus solely on research and development for renewable battery systems.
Chief executive of growth and energy, Gus Pichot, said the shift was necessary to maintain the company’s competitive edge.
“To stay at the forefront of this acceleration and maintain our competitive edge, Fortescue is shifting emphasis from in-house manufacturing to research and development, ensuring innovation moves faster and remains unconstrained,” Mr Pichot said in a statement.
“Regrettably, the changes are likely to impact some of our workforce, with the majority of those potentially affected in the United Kingdom. This is never an easy decision, and Fortescue is dedicated to guiding the transition with compassion, respect and support.”
The shake-up is the latest blow to Fortescue’s global green energy ambitions.
In July, the company scrapped its two most advanced green hydrogen projects — the Arizona hydrogen project in the US and the PEM50 Project in Gladstone, Queensland — resulting in a $227 million write-down.
The company’s $150 million Gladstone electrolyser manufacturing plant had already been under a cloud, with 90 workers laid off earlier this year.
The uncertainty surrounding the project was followed by the resignation of Fortescue’s green energy boss, Mark Hutchinson, less than two weeks later.
The latest job cuts at Fortescue Zero represent the largest cull at the company since 700 employees were laid off last year, with white-collar workers at the Perth headquarters bearing the brunt of those redundancies.
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At the time, Mr Forrest said the decision was aimed at eliminating duplication between Fortescue’s core iron ore business and its green energy arm.
“It’s in community, it’s in government relations, it’s in HR, Fortescue people — it’s in all the, like, white collar jobs where there’s duplication between mining and energy,” he said.
“It’s common sense that we bring them together... I’m a bloke that really likes to simplify things to keep them streamlined.”
