Auto strike creates major economic ripples including the closure of a huge U.S. Steel blast furnace that was ‘saved’ by Donald Trump
US Steel is idling an Illinois blast furnace that Donald Trump visited as part of his self-proclaimed “rescue” of the American steel industry five years ago, as it moves to balance production levels against the demand impact from customers affected by the United Auto Workers strike.
The Pittsburgh-based company said it decided to temporarily idle blast furnace “B” at its Granite City Works plant to ensure steel output is balanced with its order book. US Steel also said it expects third-quarter adjusted earnings of about $550 million, higher than the $485.6 million average estimate of analysts, which it said factors in the impacts of the UAW strike.
US Steel rose as much as 3.1% in post-market trading, before paring some of the gains. The shares are up more than 20% this year after the company’s announcement last month that it had started a strategic review after rejecting a takeover offer from rival Cleveland-Cliffs Inc.
Former President Trump visited the Granite City, Illinois, mill in 2018, shortly after US Steel announced it would restart part of the plant, to tout the impacts of his broad-reaching tariffs on steel imports. However, the mill’s long-term viability has long been questioned as the company continues to shift away from older, traditional steelmaking facilities in favor of plants that melt scrap and turn it into new steel.
The UAW began a strike Friday against all three of the legacy Detroit carmakers that are among the biggest consumers of American-made steel. There’s about one ton of steel per automobile produced in the US, and researcher CRU had warned that an extended strike of 3 or 4 months could force the idling of some steel mill production.
“Following the announcement of UAW strike actions, we are executing our risk mitigation plan to ensure our melt capacity is balanced with our order book,” US Steel spokeswoman Amanda Malkowski said in a statement. “We have decided to temporarily idle blast furnace ‘B’ at Granite City Works and are reallocating volumes as needed to other domestic facilities.”
