US Steel to idle parts of plants in Ecorse, River Rouge
U.S. Steel Corp. plans to indefinitely idle part of its Great Lakes Works site in Ecorse and River Rouge, affecting as many as 1,500 workers, company officials announced Thursday.
The Pittsburgh-based company expects to start idling the iron and steelmaking facilities around April 1 and the hot strip mill rolling facility before the end of 2020, U.S. Steel said in a statement.
Other areas at the complex — including the Pickle Line, Cold Mill, Sheet Temper Mill, Continuous Galvanizing Line, Annealing, and warehouses — are expected to continue operating “in line with customer demand,” according to the release.
Worker Adjustment and Retraining Notification notices are being sent to approximately 1,545 employees at the plant, said Amanda Malkowski, a spokeswoman for U.S. Steel, in an email to The Detroit News. That figure includes both union-represented and non-represented workers.
“The exact numbers have not yet been finalized, and we anticipate they will be lower subject to discussions with the United Steelworkers as well as operational and maintenance needs at the finishing facilities we will continue to operate,” Malkowski said.
United Steelworkers have been notified “and the company will remain in contact with them as it determines staffing needs at the portions of the facility that will remain operational,” U.S. Steel said Thursday.
After a brief spike in prices, U.S. steel producers have struggled since the Trump administration put a 25% steel tariff into place last year. Domestic demand has slumped as oil and gas drillers pull back on purchases of steel pipe, with prices for natural gas tumbling 45% over the past 12 months.
Representatives at United Steelworkers Local No. 1299 did not immediately respond to a request for comment Thursday night.
“We are conscious of the impact this decision will have on our employees, their families, and the local community, and we are announcing it now to provide them with as much time as possible to prepare for this transition,” said U.S. Steel President and CEO David B. Burritt in the statement.
“These decisions are never easy, nor are they taken lightly. However, we must responsibly manage our resources while also strengthening our company’s long-term future —– a future many stakeholders depend on. We will be taking steps in the weeks and months ahead to assist impacted employees by providing additional education about benefits available through our company, as well as community resources.”
According to the company’s website, U.S. Steel has a Supplemental Unemployment Benefit program that offers eligible employees benefits including temporary wage/salary replacement, continued health coverage and opportunities at other facilities.
The news of layoffs disappointed local lawmakers.
“It is unfortunate that our hardworking men and women are again paying the price for Washington's detrimental policies that have led to the market conditions US Steel and so many others have been facing," said state Sen. Stephanie Chang, D-Detroit, in a statement Thursday.
“I have already talked with the director of the Michigan Department of Labor and Economic Opportunity, which includes the Unemployment Insurance Agency, and will soon be in communication with the United Steelworkers, city officials, and others so that we can ensure working families have access to the necessary programs and support systems they might need. I strongly encourage anyone affected by these layoffs to contact my office to learn more about resources that can help.”
Thursday’s announcement follows notices by the company in October to workers at its Dearborn finishing facility about plans to idle the electrolytic galvanizing line by Dec. 1, Malkowski said.
“At this time, 27 employees have been laid off as a result of (the October notice). We still expect to offer some of the facility’s 76 employees positions at other U.S. Steel facilities. Based on current estimates, we do not believe we will reach the threshold required to issue WARN notices at this facility.”
WARN offers protection to workers, their families and communities by requiring employers to provide notice 60 days before covered plant closings and mass layoffs.
In June, U.S. Steel said it would idle a blast furnace at Great Lakes Works in Ecorse and another in Gary, Indiana, "to better align our global production with our order book."
The company temporarily laid off nearly 50 employees by August but had expected more later this year based on market conditions.
Through Wednesday, a total of 59 employees had been laid off, Malkowski said.
Great Lakes Works has an annual raw steelmaking capability of approximately 3.8 million net tons. Products manufactured at the plant include hot-rolled, cold-rolled and coated sheet steels that are used primarily by customers in the automotive industry, according to the website.
" ... Current market conditions and the long-term outlook for Great Lakes Works made it imperative that we take this deliberate but difficult step to adjust our operations so we can better align our resources across our footprint," the company's website said.
Production is slated to move to Gary, U.S. Steel said, which "will enable increased efficiency in the use of our assets, improve our ability to meet our customers’ needs for sustainable steel solutions, and will help our company get to where we want to be faster."
U.S. Steel in its last quarter reported its first loss since early 2017, and the division that makes pipes for energy companies lost $25 million.
Shares of the company were down 43% over the past year.