May 6, 2024

New Zealand News

Uneasy Stand-off Distracts From Fletcher´s LowCO Success

A widely reported proposal to axe jobs at Easysteel, a subsidiary of Fletcher Building, has cast a shadow over the official launch of Fletcher Living´s innovative residential project, LowCO. The aim of the LowCO project is to significantly reduce carbon emissions in both the build and lifecycle of residential homes. Meanwhile, the proposed sacking of workers at Easysteel operations in Auckland, Hawkes Bay and Christchurch has prompted a vitriolic response from First Union organiser, Justin Wallace. “This is an historic embarrassment and an indictment of Fletcher’s mismanagement of its subsidiaries, and workers should not be paying for executives’ greed,” said Mr Wallace. “Fletcher’s Easysteel are blaming everything from customer markets, inflation and the economic outlook for this cost-cutting restructure, but the truth is that it’s a tragedy entirely of their own making,” he added. Mr Wallace said the jobs of about 50 Easysteel unionised workers were at risk, plus the jobs of many more of their non-union colleagues.


“If this restructure goes ahead as planned, there will be a flow-on effect to the rest of Fletcher’s businesses and to the wider building industry ‒ workers will not be the only ones to pay the price,” Mr Wallace said. First Union said it has not publicly released details of the proposed restructure because the situation remains fluid. A Fletcher Building spokeswoman said no decisions had been made and the company´s priority would be to work with those potentially impacted by the process. 

The controversy erupted shortly before the April launch of the LowCO project, at which Fletcher Building revealed how homes will need to be built in a low-carbon future. “On average, the lifespan of a home is 90 years. We did some research and found that over that time homes emit seven times more carbon than acceptable if we are to keep global warming within the 1.5-degree celsius limit,” said Steve Evans, Chief Executive of Fletcher Building’s Residential and Development Division. “Fletcher Living wanted to show that this (high carbon count) doesn’t have to be the case. To prove it, we set about designing and building a number of different house typologies that use seven times less carbon than the average home. Called LowCO, these homes redefine the standards of modern living by using less carbon along with significantly reducing energy consumption and water usage,” he said at the launch.

The first LowCO build, at Fletcher Living’s Waiata Shores development, includes a three-bedroom detached home plus a three-unit terrace block. Both builds fit within New Zealand’s carbon budget for new built homes.

“We often get asked what it costs to build a high-performance home such as LowCO. While there are slightly higher upfront costs when building, from the point of view of the lifecycle of the home, it will cost less overall due to the reduction in electricity and water consumption,” Mr Evans said. “I hope what we have achieved with LowCO will be both a beacon for the industry and a call to action that change is possible if we choose to think differently. To support this change and to encourage others to take up the technology and innovation throughout the industry, we will be making the LowCO architectural plans and product lists freely available on the Fletcher Living website,” he added. LowCO was recently awarded a 10 Homestar built rating from the New Zealand Green Building Council. This is the highest independent rating for a residential build.

Finally, in bad news for the steel industry, Stats NZ revealed last week that only 35,236 new homes had been consented in the year ended March 2024. That´s a massive 25% drop on the previous year. Within the figures, 15,166 stand-alone houses were consented (thus 23% lower than the year ended March 2023) and 20,070 multi-unit homes were consented (down 26% on the March 2023 figure). The continued cooling in the country´s home building market is reflective of a worsening in the labour market trend. New Zealand´s official unemployment rate increased to 4.3% in the March 2024 quarter, rising from 4.0% in the previous quarter. Tighter monetary policy is clearly having its effect.

* This month´s New Zealand Steel News was authored in-house by Australian Steel News