Voestalpine Underlines Expansion Into Asia and America
For voestalpine´s CEO Wolfgang Eder, Europe is a stagnating market. By contrast, growth is expected to take place in the U.S.
Voestalpine Underlines Expansion Into Asia and America / Picture: © Flickr / Worldsteel
In an interview with “Wirtschaftsblatt”, Eder explains that the U.S. is perceived to be a growing market. “We are investing in the U.S. as we are welcome there. U.S. leaders have recognized that a reindustrialization is necessary in order to create jobs.” In the next two years, voestalpine´s investments should reach about € 100m. “It is a part of our corporate strategy to promote the globalization in the automotive segment.”
In Austria, voestalpine´s steel production will stagnate. The major challenge will be the cost optimization. The three other divisions should expand, however.
In China, no major projects are planned. In the long term, two-digit million investments are planned. Other future markets will be Brazil, where the special steel production will be enlarged.
In order to finance voestalpine´s investments, bond issues are likely. A capital increase is not planned, Eder indicated. “Anyway, we want to reduce the dependence on banks further.”
Europe´s steel industry currently faces low steel prices anyway, Eder explains. In addition, fears of a growing competition is rising. The steel industry expects growing pressure from the East, Eder recently said to the German newspaper „Handelsblatt“.
In the long term, the major rivals of the European steel industry will not be Chinese or Indian competitors. The main problems will be Russian, Turkish and Ukrainian steel producers. At the moment, China exports 8 million tons of steel to Europe per year. However, transport costs come at € 50 per ton.
Eder thinks that the European steel industry should cut its current annual capacity of 210 million tons by 25%. The current demand would only amount to 160 million tons. „If the downszing should be socially acceptable, it should be initiated soon.“