Subscribe to Dollars & Sense magazine. Recent articles related to the financial crisis. Steelworkers Attack ArcelorMittalFrom yesterday's WSJ; find background on the situation in this feature article in our current issue. The CEO of ArcelorMittal—the largest steel firm in the world—is Lakshmi Mittal, who is one of the richest people in the world. He is so rich that, as Roger Bybee reported in his feature article for us, he spent $55 million on his daughter's wedding. If you're wondering how even the super-rich could spend that much money on a wedding, it helps to know that they rented out Versailles for the reception. —csSteelworkers Attack ArcelorMittal Fed Up With Plant Shutdowns, Protesters Smash Windows at Annual Shareholder Meeting in Luxembourg By ROBERT GUY MATTHEWS ArcelorMittal is facing increasing worker protests around the world, including a violent confrontation during an annual shareholder meeting Tuesday in Luxembourg, as frustration mounts over plant shutdowns and the reluctance of the world's biggest steelmaker to commit to reopening idled facilities. Although ArcelorMittal has already cut production in half and shut down plants and blast furnaces around the world—including some iron ore operations idled Tuesday in Indiana—it still makes more steel than customers need and expects global steel demand to sink by up to 20% this year. On Tuesday, an estimated 1,000 steelworkers from the company's plants in France and Belgium attacked its headquarters in Luxembourg, setting off smoke bombs and smashing windows in an effort to disrupt an annual shareholder meeting. The meeting went on despite the protests. Lakshmi Mittal, chief executive officer of ArcelorMittal, told shareholders that customers are buying less steel and using their current inventory. Producing steel that could not be sold, he said, was pointless. Mr. Mittal said that he would shift steel production from higher cost plants to more efficient steelmaking plants, but declined to say where or when. Many of the companies higher cost plants are located in Europe and the U.S., where labor costs are higher. Raw material costs in those countries also tend to be higher because those plants tend to be further from mines that produce the raw materials. In addition, plants in those regions are tied to certain markets, particularly automotive, that have seen a steep drop off in demand. In the U.S., the local steel union mounted a nonviolent protest at the company's Chicago headquarters two weeks ago, over the anticipated permanent closure of ArcelorMittal's Hennepin, Ill., plant. Duane Calbow, vice president of the local 7367 United Steelworkers, said that Chicago workers are frustrated because the company doesn't seem interested in running the plant or trying to sell the existing operations or find other uses for the facility. Read the rest of the article; read Roger Bybee's feature article on ArcelorMittal (the sidebar on Marie Antoinette is particularly juicy). Labels: ArcelorMittal, Lakshmi Mittal, Roger Bybee, Steel industry Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Steel Industry Looking For $1 TrillionThe next contender in the category of "too big to fail" appears to be Big Steel. Through the first three quarters of 2008, the steel industry was going gangbusters. By late December, however, weekly production had fallen by more than 50% from August levels. Prices have fallen like lead. Tens of thousands of workers, mostly unionized, have been temporarily laid off, with future prospects exceedingly grim. Now industry execs are praying for an Obama miracle of government investment and subsidies.From the New York Times: The steel industry, having entered the recession in the best of health, is emerging as a leading indicator of what lies ahead. As steel production goes - and it is now in collapse - so will go the national economy. The rest of the article is here. Labels: New York Times, Steel industry Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). |
