ArcelorMittal Aims To Boost Profits With New Auto Steel

Jun 10, 2016

ArcelorMittal's Indiana Harbor steel mill is its largest in North America.
Credit David Wilson / https://www.flickr.com/photos/davidwilson1949/12783674125

Steelmaker ArcelorMittal, whose largest North American mill is at Indiana Harbor in East Chicago, is introducing a new high-strength steel for cars.

It's part of an effort to boost profits at the world's largest steel producer by volume -- amid an uncertain time for the industry.

The new steel is designed for the interior rails and pillars that make cars safer during a crash.

A spokesperson from Arcelor says it should make cars lighter and cheaper to produce when it's rolled out next year.  

Indiana automakers already buy much of their steel in-state, including from Arcelor. The company says it has struggled to compete with cheaper sellers overseas -- especially China.

But new tariffs on Chinese steel may be helping. Steel imports have accounted for 23 percent of the market so far this year, down from a record high of 29 percent last year.

The U.S. has imported 12.9 million net tons of steel so far this year, down 31 percent from the same period last year. The American steel industry itself forges about 90 million tons of steel annually.

Now, Arcelor is working to boost profits by $3 billion in the next four years, with products like the new auto steel. The company wouldn't confirm whether that product will be made in Indiana.

But Pete Trinidad, a steelworker and union steward at Arcelor's Burns Harbor plant, thinks it might. He says that would create stability for Arcelor's more than 8,000 Indiana workers.

"The automotive industry… would order that from us and guarantee us hours on our mills," he says.

Plus, he says, the steelworkers' new union contract gives them bonuses if company profits or prices on particular types of steel reach certain thresholds.

That goes for union workers in Gary, too, at U.S. Steel -- the company pursuing a total ban on Chinese steel imports through the International Trade Commission.