Germany’s largest steelmaker, Thyssenkrupp, has announced plans to cut jobs and reduce production capacities as it grapples with overcapacity, rising cheap imports from Asia, and competitive pressures.
Under its proposed industrial strategy, Thyssenkrupp Steel Europe AG aims to boost productivity, streamline operations, and lower costs. The plan includes eliminating around 5,000 jobs by 2030 and transferring or selling another 6,000 roles to external providers, with personnel costs targeted for a 10pct reduction. The company emphasized avoiding redundancies for operational reasons.
Production capacities will be scaled down from 11.5 mln tons to 8.7-9 mln tons to align with market expectations. The strategy also involves selling its stake in Huttenwerke Krupp Mannesmann (HKM) or negotiating closure scenarios with other shareholders if a sale proves unfeasible. Additionally, the Kreuztal-Eichen processing site will be closed.
Thyssenkrupp’s steel division has faced significant challenges, including global steel oversupply, higher energy costs following Russia’s invasion of Ukraine, and increased competition from Asia. Last week, the company downgraded the value of its steel business by EUR 1 bln (USD 1.04 bln) due to weak earnings forecasts and the high costs of transitioning to green steel production.
The restructuring aligns with Thyssenkrupp AG’s efforts to make its steel unit independent. Following the sale of 20pct of Thyssenkrupp Steel to Czech EP Group, the stake is expected to increase to 50pct. The company’s long-term goal is to make the steel business profitable, competitive, and carbon-neutral.
1 USD / 0.95 EUR
