Iron ore price down = profitmargins down = productivity up = efficiency up = excavation up = specialization up = ‘cutting programs’ up = number of staff down = learning down = esprit de corps down.
As a consequence of our talks to different people in and around Kiruna, this equation has been spinning in our minds. Then all of a sudden (at least for us) the CEO of LKAB, Lars-Eric Aaro, was fired! Here is the explanation given by the chairman of the board, Sten Jakobsson (translated from Dagens Industri, 2015-05-28):
“Six, seven months ago the market price was 70 percent higher. We are now in a phase where we have to use every ounce of productivity and cost efficiency to keep us afloat. Lars-Eric Aaro was good at markets, customer relations and brand management. He has also worked with cost savings, but we need to go a step further.”
The new CEO is Jan Moström, from another Swedish mining company, Boliden. A leading columnist in the largest daily newspaper in the county of Norrbotten, NSD, states that dark times now await LKAB and he gives the new CEO a nickname: “The Butcher from Boliden”.
The voice of a young Bob Dylan echoes – North Country Blues