The first conceptual principles of a planned realignment of the steel division were presented to the strategy committee of the steel supervisory board by the board of thyssenkrupp Steel. The aim is to position thyssenkrupp Steel for the future under persistently challenging market conditions.
A reduction of the production capacities installed in the network to a shipping target corridor of approx. 9 to 9.5 million tonnes per year will be the core of the realignment. The current production capacity, however, is designed for around 11.5 million tonnes of shipping.
Key elements of the previous 20-30 strategy are also confirmed for a new lineup: the focus on premium grades as well as thinner and stronger materials remains. Topics such as energy transition and electromobility also remain in focus.
Reasons for realignment
With the planned realignment, thyssenkrupp Steel is reacting on the one hand to the persistently weak economy, but above all to medium and long-term fundamental structural changes on the European steel market and in key customer and target markets.
These include, among other things: - especially in Germany - the high energy costs, which continue to rise due to climate policy objectives, as well as unbridled increasing import pressure, predominantly from Asia, and a continuing deterioration in the steel trade balance, which in total lead to reduced industry competitiveness.
Reduction in production capacity
thyssenkrupp Steel evaluated these factors in a detailed analysis, supported by an independent external report. As a result, shipping volumes in the future are expected to remain at the level of previous years. In comparison, the total production capacity still installed today is significantly too high and the entire production network is therefore structurally underutilized.
The planned reduction in production capacity will lead to a consolidation of crude steel capacities in Duisburg. These measures will also involve job cuts that cannot yet be quantified, which will also affect the downstream processing stages as well as the administration and service areas.
The planned measures are absolutely necessary to maintain competitiveness, to lead steel production at the Duisburg location into a secure future, to secure high-quality jobs in the long term and to make the basic supply of steel resilient for industrial value creation in Germany.
The declared goal is to continue to avoid redundancies for operational reasons. The plans for the realignment will now be further fleshed out immediately and then discussed with co-determination and the responsible committees in the steel sector.
Green transformation remains unchanged
thyssenkrupp Steel's strategic goal of sustainably financing itself through its own earnings power and thus further improving its ability to capital market remains fundamental. Until the structural measures take effect and have an impact, the current performance programs will be further intensified in order to achieve the necessary earnings effects.
There will also be no changes to the implementation of the green transformation that has already been initiated. The construction of the first direct reduction plant at the Duisburg site will continue to be implemented as planned, with support from the funding released by the federal and state governments, which is essentially related to the ambitious ramp-up of the plant's hydrogen operation. The goal of producing completely climate-neutral production by 2045 at the latest also remains unrestricted.
