ArcelorMittal has signed a memorandum of understanding with the Steel Authority of India Limited for a joint venture that would establish an automotive steel manufacturing plant in India.
The steel giant also announced plans to idle its wire rod mill in Georgetown, South Carolina, US, and reassess its other U.S. holdings, especially finishing facilities, to offset record imports, increased competition and too-high legacy costs. The closure will cost 226 American workers their jobs.
The company recently reported a $103 million first quarter operating loss for its North American division. Arcelor’s U.S. holdings lost nearly $1.5 billion over the past five years, one executive pointed out.
ArcelorMittal said a MOU is just the first step in establishing a joint venture, which would involve building a state-of-the-art cold rolling mill and other downstream finishing facilities in India that will offer technologically advanced steel products to India’s rapidly growing automotive sector, the company said in a news release. India is expected to become the world’s fourth largest automobile manufacturing nation by 2020, growing from roughly 3.5 million units today to more than 7 million units, they said.
