German Chancellor Olaf Scholz has unveiled several measures to help Germany’s struggling steel industry, which has been under the pressure from high energy costs, low-priced imports and an economic downturn, following a meeting with representatives of the domestic steel industry, according to media reports.
Within the scope of the measures, the German government will continue supporting the transition to low-carbon steel technologies by providing several subsidies to steel companies. Moreover, Scholz stated that he will extend the state aid, allowing employers to switch to shorter working hours. Additionally, the government intends to cap the costs of electricity transmission at three cents per kWh, partly finance the costs of the transmission, and ensure that transmission fees do not skyrocket next year. Also, the German chancellor did not rule out the possibility of the government investing in Thyssenkrupp Steel Europe.
Thyssenkrupp has already announced plans to reduce its production capacities from the current 11.5 million mt to 8.7-9 million mt and to cut around 5,000 jobs by 2030, due to the considerable strain on competitiveness caused by overcapacity and rising cheap imports from Asia, as SteelOrbis reported previously.
In the meantime, pointing out that they need stricter protective measures from Europe, Scholz has called on the EU Commission to act against dumped steel imports to protect European companies. “The steel industry will accompany our industry for centuries to come and it is now important to secure steel production in Germany in the long term,” the German chancellor commented.