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Thyssenkrupp steel board to meet next week as major overhaul takes shape, sources state

Thyssenkrupp is anticipated to present preliminary information of prepared significant restructuring at its steel department next week, 2 people familiar with the matter stated, in what is most likely to result in significant capability and task cuts at the system.

The supervisory board of Thyssenkrupp Steel Europe, Germany's biggest steelmaker, is set up to satisfy on April 11 to discuss the method, individuals said, declining to be named as the talks are confidential.

The review is expected to form the basis for talks with effective labour unions, which have half of the supervisory board seats.

Details might include more specifics on which parts of the service will be impacted, the people said, likewise pointing to possible modifications at steel joint venture HKM, which Thyssenkrupp co-owns with Salzgitter and Vallourec.

Baader Bank analyst Christian Obst, keeping a purchase ranking on the stock, said it made sense for Thyssenkrupp to develop a. long-lasting prepare for steel, consisting of capability changes.

He said one possible outcome might be a move to phase out. Thyssenkrupp Steel Europe's 2 smaller sized heaters with a total. capacity of around 3.7 million tonnes over the next 10-15 years,. in favour of the 2 bigger ones with an overall capacity of 7.7. million tonnes.

The strategy might lay the foundation for thousands of job cuts at. business, individuals stated, though it was not clear yet. whether there would be any forced layoffs and that no final. choices had been taken.

Under a previous contract with unions, Thyssenkrupp has. dismissed task cuts at its steel unit till March 2026.

Thyssenkrupp Steel Europe and parent Thyssenkrupp AG both. decreased to comment.

Handelsblatt in February reported that a minimum of 5,000 of. Thyssenkrupp's approximately 27,000 steel jobs were at risk.

Fears of a bigger turnaround at the department were stoked in. February, when Thyssenkrupp Steel Europe's Chairman Sigmar. Gabriel cautioned the business needed to essentially change.

This could consist of task cuts and capacity reductions, Gabriel. said, explaining that while Thyssenkrupp Steel Europe could. produce nearly 12 million metric lots of steel a year, it just. sold around 9 million lots and perhaps even less in the future.

Capability could be reduced by shutting down some of. Thyssenkrupp's blast heating systems, the sources said. That is likewise a. sticking point in talks with EPH, the energy holding company of. Czech billionaire Daniel Kretinsky, which Thyssenkrupp tries to. win as a co-owner of the steel division.

The prepared overhaul can be found in reaction to continuing. weak point in the automobile sector, Thyssenkrupp's greatest client. group.

The slowdown has actually already triggered a number of providers, the majority of. especially ZF Friedrichshafen and Continental AG. , to reveal job cuts.

IG Metall, Germany's greatest union which represents. Thyssenkrupp employees, has actually called a general conference for April 30. to air its disappointment over what it fears might be unpleasant cuts.

(source: Reuters)