ThyssenKrupp Steel Europe expects lower sales amid global uncertainty
Thyssenkrupp Steel expects continued challenges due to geopolitical tensions and uncertainty in global trade policy, but remains committed to its goals of "green transformation" and sustainable development, according to the quarterly results report of the second largest producer of rolled steel in Germany dated May 15.
ThyssenKrupp Steel Europe continues to modernize its low-carbon production, while maintaining cautious forecasts and expecting sales to decrease by 3-6% in the 2024-25 fiscal year (October-September).
Steel Europe's sales decreased by 8% year-on-year to 2.64 billion euros in January-March, while sales for the first half of the fiscal year fell by 6% to 10.7 billion euros.
Steel production faced weak demand and insufficient workload, especially due to a reduction in orders from the automotive industry. The impact of prices has led to a decrease in sales revenue and capacity utilization.
Thyssenkrupp produced 2.08 million tons of steel in January-March, compared with 2.48 million tons in the previous quarter and 2.697 million tons a year earlier.
"For Thyssenkrupp, the 2024/2025 financial year is developing in accordance with our forecast. Strategically, this is a year of decision-making; financially, it is a year of transition," said Miguel Lopez, CEO of Thyssenkrupp AG.
"Steel Europe is resolutely working on the planned business restructuring. We are consistently implementing the measures of our APEX efficiency improvement program in all segments. On the contrary, the continuing difficult market conditions are reflected in our operating performance for the second quarter. In the second half of the year, we expect a more stable market environment and a positive effect from the measures we have taken. Thus, we confirm our annual forecast," he added.
Steel Europe is moving forward in its reorganization based on the existing industrial concept of the future. In early May, IG Metall, the metalworkers' union, and Thyssenkrupp Steel reached an agreement in principle on the necessary restructuring. Further negotiations are expected to lead to the conclusion of a collective agreement by the summer.
Another key element of Thyssenkrupp Steel's future positioning strategy is the severance of economic ties with Hüttenwerke Krupp Mannesmann, as this will lead to a reduction in production capacity of up to 8 million people.-9 million tons per year compared to the current 11.5 million tons per year. In early April 2025, Thyssenkrupp Steel began to implement this step by terminating the supply contract with HKM. As a result, Thyssenkrupp Steel Europe's commitments to purchase about 2.5 million tons of steel per year will expire by the end of the year at the latest.