Thyssenkrupp Steel Europe, a subsidiary of German steelmaker Thyssenkrupp, has announced its plans for a comprehensive future industrial strategy in the face of the further consolidation of fundamental and structural changes in the European steel market, and in key customer and target markets. Noting that overcapacity and the resulting rise in cheap imports, particularly from Asia, are placing a considerable strain on competitiveness, the company stated that urgent measures are needed to improve its own productivity and operating efficiency, and to achieve a competitive cost level.
According to the plans, Thyssenkrupp Steel will reduce production capacities from the current 11.5 million mt to 8.7-9 million mt in line with market conditions, thus adapting capacities to future market expectations. For the capacity reduction, the company aims to sell its shares in Hüttenwerke-Krupp Mannesmann (HKM), as SteelOrbis previously reported. In addition, the processing site in Kreuztal-Eichen is to be closed.
Meanwhile, the planned adjustments of production will result in the loss of around 5,000 jobs by 2030. In addition, a further tranche of about 6,000 jobs is to be transferred to external service providers or shed through the sale of business activities. The company also plans to reduce personnel costs by an average of 10 percent over the coming years, thus adjusting them to a competitive cost level.
“It is a surprise for us too. They actually wanted to go public with this in the first quarter of 2025. The fact that they are already doing this now indicates that they want to exert pressure on politicians before the elections. Electricity costs are too high and there are too few orders from the automotive and construction industries. So, politicians must do something to reduce electricity costs and lower interest rates to revive construction. Perhaps the background is as simple as that,” a German source told SteelOrbis.