U.S. Steel Realigns Operating Units to Meet Strategic Goals
United States Steel Corp. (X) has reached another important step in its Carnegie Way program. It is realigning its three business segments – North American Flat-Rolled, Tubular and U.S. Steel Europe – to attain three strategic goals. These are to increase collaboration with customers, focus on the Carnegie Way projects within the operating units with reliable maintenance and quality, and proper safety, and to create more focused and effective accountability.
According to the president and CEO of U.S. Steel, Mario Longhi, this realignment will help the company to create a closer bond with its customers by catering to their market demands, thus strengthening its position globally.
The North American Flat-Rolled segment will be realigned with the creation of commercial entities to address five markets – automotive, consumer, industrial, service centers and mining. Each entity will be headed by a business leader for delivering better customer solutions.
Automotive Solutions will be located in the U.S. Steel’s Automotive Center in Troy, MI. The company works jointly with its consumers at the facility, using the advanced high-strength steels (“AHSS”) to address the fuel economy standards and safety demands of the industry.
Consumer Solutions, on the other hand, will address consumers in the appliance, packaging, container and construction markets. Additional product lines within the unit include COR-TEN AZP, ACRYLUME, GALVALUME and Weathered Metals.
The Industrial Solutions will cater to the company’s customers in the pipe and tube manufacturing markets, and the agricultural and industrial equipment markets.
Service Center Solutions will work with service center and distributor customers.
Mining Solutions will look after the operations of the company's Minnesota Ore Operations facilities – Minntac in Mt. Iron and Keetac in Keewatin – as well as its iron ore equity joint ventures.
Moreover, the company will stress on implementing strategic initiatives with reliable maintenance and quality, and proper safety measures under the Flat-Rolled manufacturing operations.
U.S. Steel Tubular Products’ commercial and manufacturing operations, now known as Energy Solutions, will also be realigned to include customer solutions for the oil and gas industry. The unit will be based in Houston, and focus on the development of the company’s tubular operations as well as the U. S. Steel Tubular Products Innovation and Technology Center.
U.S. Steel Europe will be renamed U. S. Steel European Solutions and is currently being aligned through the Carnegie Way transformation to increase focus on their customers.
U.S. Steel will continue to have the previous three reportable operating segments and remain unaffected with the new management structure and commercial entities. The company will conduct an extensive search for the business leaders required for each entity.
U.S. Steel currently holds a Zacks Rank #1 (Strong buy).
Some other companies in the steel industry worth considering include Kobe Steel Ltd. (KBSTY), Mechel OAO (MTL) and Nucor Corporation (NUE). All of them carry a Zacks Rank #2 (Buy).
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