ThyssenKrupp delays steel production in Mobile

01/28/2009

By Dan Carsen

In response to decreased demand from builders and automakers, Germany’s ThyssenKrupp AG announced Friday in Dusseldorf that it was delaying the start of stainless steel production at its plant north of Mobile, Ala., by one year.

In a move meant to shore up cash reserves during the global economic downturn, stainless steel production at the $4.6 billion site being built in Calvert is now set to begin in late 2010.

“We’d been on a really fast track,” says Mary Mullins, director of communications for ThyssenKrupp Stainless USA. “This just gives us a little more breathing room.” Company leaders hope to time stainless steel production startup to take advantage of what they predict will be a rebound in demand.

At the facility, which straddles Mobile and Washington Counties, carbon steel and stainless steel operations are run by separate subsidiaries with different boards and management structures. Spokesmen for both companies said ThyssenKrupp Steel USA is on pace to meet its original goal of beginning carbon steel production – which will account for roughly two-thirds of the plant’s output – in the spring of 2010.

The two companies will share the hot strip mill and the terminal on the Tombigbee River, through which will come slabs from Brazil for carbon steel making and scrap for stainless steel production.

Mullins said construction of the 3,500-acre dual-output facility, which began in November 2007, is continuing on schedule. ThyssenKrupp executives want the buildings enclosed before the heart of the 2009 hurricane season. Mullins added that the delay in stainless steel production would not affect current employees.

Once fully operational, the whole plant is expected to employ about 2,700 people, with some 900 on the stainless steel side.

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