A newly expanded, seven-story plant, manned by a small nonunion workforce producing high-strength steel for car companies, is the new face of the 112-year-old U.S. Steel Corp.
A new production line uses new heating and cooling technology to make steel stronger for car makers. Added strength is important for two reasons. It means car companies can use less steel, reducing weight, which is critical for meeting new, tougher federal fuel-efficiency standards. Stronger steel also better withstands collisions, according to tests.
The small-town plant stands visible from miles away. It is operated by 312 nonunion workers, some of them part-time farmers.
The USW said it considered organizing workers at the Pro-Tec plant but didn't get much interest. "Union organizing efforts have not resulted in representation for the workers in Leipsic," said Tony Montana, a USW spokesman.
The Pittsburgh-based company plowed $400 million into the expansion of the plant here, formally named Pro-Tec Coating Co., with its joint-venture partner in the facility, Japan's Kobe Steel.
With industry prices and profits squeezed by 200 million tons of excess global steel capacity, steelmakers are under increasing pressure to make high-margin, custom-designed products, using low-cost, highly automated production. Auto makers' use of advanced high-strength steel, the name steelmakers have given to their lighter and sturdier chemically enhanced metal, has doubled.
The investment in Pro-Tec is U.S. Steel's best bet on where the steel industry is headed.
The Pro-Tec plant would help secure a victory for steel over its main rival, aluminum in the battle for the automotive market.
The auto market is "where companies are still able to make money on value-added goods, even where the market is weak," said Charles Bradford, an analyst with Bradford Research.
Traditional capital-intensive steel plants are becoming more efficient, with smaller workforces and a higher percentage of white-collar jobs, said Cliff Waldman, an economist.
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