Intention to permanently close the liquid phase in Florange

ArcelorMittal Atlantique and Lorraine met yesterday with its central works council to discuss its intention to present a proposal for the future of its Florange plant. Given the continued economic difficulties affecting the French and European economies, the company wishes to propose to permanently close the liquid phase and concentrate efforts and investment on the high-quality finishing operation, which employs more than 2 000 employees.

To date the company had implemented a strategy of temporary idling the Florange furnaces whilst waiting to see if the economic situation would improve. However after four years of challenging conditions, it is clear that there will be no swift return to pre-crisis levels. Today European demand is still approximately 25% below 2007 levels. This proposal has not been made lightly but it is a reality that the Florange liquid phase and the slab it produces are not competitive in today’s difficult economic context. This is due to a combination of factors, including crucially its location 400 km from the nearest harbour as well as the small production output that negatively impacts fixed costs.

Although there is significant overcapacity in the European steel industry, the company has accepted the French government’s request for the government to find a buyer for the liquid phase within the next 60 days. Although the coke plant would not be part of the proposed closure, ArcelorMittal has agreed to include in the sale.

In parallel, ArcelorMittal would like to begin an exemplary social dialogue for the proposed closure of the liquid phase. Some 629 people would be affected by the project. The company understands that this information is very difficult for those employees who are affected. However the company believes that it can avoid any compulsory lay-offs by utilising a number of social mechanisms, such as mobility and the age profile of the plants, which will be agreed as part of the social dialogue in order to find a solution for each person.

The company is proposing that in the future, slab for the Florange site will continue to be transported from Dunkerque, a world class site, thereby maintaining the industrial chain in France. ArcelorMittal will then focus on enhancing Florange’s position as a centre of excellence for developing high-quality value-added products for its customers, most notably in the automotive industry. Florange’s geographic location close to important customers in the industry; its expertise and capacity in producing high-tech steels, the group’s patents and its proximity to the Maizieres-les-Metz research and development centre, all support this strategy. For example the recent € 7.2 million investment in the existing galvanizing line will see Florange being able to produce the highest width Usibor, in the world. ArcelorMittal is committed to continue to invest the appropriate amount to ensure a sustainable future for the finishing operations in Lorraine.

ArcelorMittal, Luxembourg