In order to secure the future viability of our steel business, the "one steel" strategy program will be further advanced. This includes savings, but also high investment.
To reach the targets defined in our vision – as well as to help secure the longterm sustainability of our steel business – we started our one steel program last year. As a first step we restructured our organization to be closer to the market and started remodeling our IT infrastructure. We analyzed our business fields and the market carefully and tried to leverage market potentials and customer needs to become more profitable. However, our market environment continues to be difficult, and our business outcomes are not expected to improve significantly in the near future.
We have always been transparent about the possibility of the restructuring of our whole steel business – independent of a possible joint venture with a partner. Today, we presented our findings to the Works Council. These findings will be discussed within thyssenkrupp AG as well as presented to the Supervisory Board of Steel Europe on May 4.
We have to consider all controllable costs and possible costcutting measures to help prevent plant closures. To be clear: we have to reduce our costs by 500 million Euros in the upcoming years.
Necessary actions include costcutting in the areas of staff, maintenance and repairs, logistics, sales, and administration. The first part of the action plan applies to our Business Unit Heavy Plate and includes the closure of both existing cuttolength lines in the south of Duisburg and Bochum. At the moment we cannot foresee exactly how many jobs will be affected but we will, of course, discuss everything with the Works Council.
Please keep in mind these actions are not only about cuttings costs. On the contrary, we plan to invest more than eight billion Euros in a sustainable steel business over the next five years. This includes critical investments in maintenance and modernization of our plants, research and development, and advancement of our IT infrastructure. We will invest in measures where we expect the greatest potential for our steel business. This is how we want to make our company profitable and sustainable for the future.
We will carefully proceed with all feasible and reasonable measures – and in close alignment with the Works Council, just as we have in the past. This is our culture at Steel. We will inform you as soon as we have specific decisions and results from our upcoming discussions.
Andreas J. Goss, Premal A. Desai, Heribert R. Fischer, Arnd Köfler, Thomas Schlenz