Anthony Suau @ 2011
February 16, 2011
Sergei A. Kuznetsov, chief executive officer of Severstal North America in front of the old (left) and new "C" blast furnaces.
The former Ford Rouge Steel Plant completed in 1928 is now owned, run and being renovated and expanded by Russian owner "Severstal North America". This is one of five steel plants owned by Severstal in the United States and they are spending huge sums to convert it into what could be the continent's most efficient automotive steel plant.
Rouge Steel fell on hard times after Ford Motor Company spun it off in 1989 into an independent steel company.
After buying the assets of the bankrupt company for USD 280 million, Severstal spent USD 350 million to repair one of the blast furnaces. The company built a new cold-rolling line which converts steel slabs into sheet metal. And it added a galvanizing line which coats sheet metal with zinc for rust-resistant body panels.
The operation assets and improvements amount to USD 1.4 billion. Add in spending on a new mini mill in Columbus, Mississippi a USD 1.6 billion operation and Severstal has placed a USD 3 billion bet on North America auto industry.
Mr Kuznetsov said "The auto industry will have to meet tough fuel efficiency standards and weight is a big issue. Vehicles have to be lighter and I think this is going to be a big play for the industry."