The leadership for U.S. Steel and their routine practice for often changing their playbook has always reminded me of the flighty personality of a friend of mine.
They both practice a mashup of Mr. Haney, the sneaky salesman who sold so many things, including the sketchy Green Acres farm to Oliver Wendell Douglas, and a televangelist, enthusiastically praising the virtues of their product.
My friend would switch his deep interests every couple years and dive into photography, guns, woodworking or selling knives with each hobby being much greater than the last. He also was a religious man but his actions contradicted the beliefs he would rapture about.
Similar to a person struggling with attention deficit disorder, USS changes their corporate campaigns and their corporate strategy that is tagged with what they believe to be a catchy slogan. As if time were erased and everyone from employees, stakeholders and customers will be drawn to the cornball slogan like a moth to a flame, they soldier on with the same practices.
I have listened to their quarterly earnings calls more often than I like to admit. But they pitch the latest slogan to the investment gurus so often during the call, surely someone besides me is laughing at the contradiction behind the monitor.
“Best for All” - “The Carnegie Way” - “Ethical Code of Conduct” - “Best of Both” and too many more to mention.
GCS has been informally designated the tubular goods producer but the GCS facility made countless grades of steel for many customer and service centers, a nimble product mix. But the facility’s blast furnaces will soon be idled with USS shamefully using the UAW strike as their reasoning.
Seems like Mr. Haney has come to life. Remarkably, overnight the strike caused a depletion of service center inventories and the automaker’s orders. We all understand these decisions are made to maximize stockholder value as market conditions are ever-changing in steel’s cyclical business. But to use the UAW strike as a tool to, seemingly, pit union workers against one another is the televangelist at work.
As the reader, I can hear you murmuring, serving as the judge: “Make your point counselor. What is the relevance?”
I will be using bullet points your honor, abbreviating while offering a historical reflection on USS inconsistencies and contradictions that stir emotions but decisions, big corporate announcements, that are often quietly abandoned.
2018 Q3: Answer to investment analyst question about Keetac Iron Mine operation.
USS CEO David Burritt: “Does it make sense to go through the – how long we'll keep Keetac open or not? There's some decisions to be made, but it's going to be customer-driven.”
June 2022: U. S. Steel plans to break ground in Fall 2022 at its Keetac Minnesota Ore Operations facility, to construct a system dedicated to producing DR-grade pellets. This will enable one of the Company’s existing pelletizing plants to not only create EAF DR-grade pellets but also maintain the optionality to continue producing blast furnace-grade pellets.Q4 2019 Earnings Call:
We have announced an investment of more than $1 billion to build a sustainable endless casting and rolling facility at its Edgar Thomson Plant in Braddock, Pennsylvania, and a cogeneration facility at its Clairton Plant in Clairton, Pennsylvania, which are part of the company's Mon Valley Works. Mon Valley will produce the projected volume of advanced high strength steels. We now expect the total investment to be approximately $1.5 billion.April 2021 Press Release:
Pittsburgh-based United States Steel Corp. announced that it is canceling a $1.5 billion project to bring a state-of-the-art improvement to its Mon Valley Works operations in western Pennsylvania, saying the world has changed in the two years since it announced its intentions.
June 2022 Press Release:
US. Steel also announced that it plans to have SunCoke Energy, Inc., a raw material processing and handling company, acquire the two blast furnaces at Granite City Works in Illinois and build a 2 million ton granulated pig iron production facility. “This will enable one of the Company’s existing pelletizing plants to not only create DR-grade pellets but also maintain the optionality to continue producing blast furnace-grade pellets.”
The proposed transaction is contingent upon several conditions, including the negotiation and execution of a definitive agreement, approval by the U. S. Steel Board of Directors, and receipt of all appropriate regulatory approvals. There can be no assurance as to the final terms of the proposed transaction, that the conditions will be satisfied, or that the proposed transaction will be completed,” a company spokesperson wrote in a press release.
Q2 2023 Earnings Call:
Curtis Rogers Woodworth - Crédit Suisse AG, Research Division
I was wondering if you could give us an update on the plans for Granite City, and if there's a tentative agreement with SunCoke, repurposing the furnaces into pig iron facilities. Is that still part of the framework? I know that's been a little while.
David Boyd Burritt - United States Steel Corporation - President, CEO & Director
Your more specific question is related to Granite City, which has been in discussions for some time. I know Rich is following that closely. I'm not sure we got a whole lot to update you on here.
Richard L. Fruehauf - United States Steel Corporation - Senior VP and Chief Strategy & Sustainability Officer
Well, I think you kind of hit it, Dave. So first of all, we got the 500,000 tons coming out of Gary from that pig project. That's already flowing down to Big River, and we've seen some meaningful cost improvements coming from that project. And I think the Granite City conversations with SunCoke, we continue to have conversations with them. We think things are going well, and we hope to have a mutually acceptable agreement. But that's all I can say right now in terms of the Granite City project.
September 20, 2023
Press Release:
“NETL and United States Steel Corporation plan to test an advanced membrane technology to capture carbon dioxide (CO2) emissions generated by steelmaking operations at the Company’s Edgar Thomson Plant, located in Braddock, Pennsylvania.
The project is part of the U.S. Department of Energy Point Source Carbon Capture Program. Point source carbon capture from industrial facilities, such as iron and steel manufacturing plants, is a vital element to reduce CO2 emissions and meet the nation’s goals to address climate change.”
September 21, 2023
Press Release:
Reuters: “U.S. Steel Corp is locked in a spat with rival steelmaker Cleveland-Cliffs Inc over a confidentiality pact that would allow the latter to participate in a sale process that is underway, people familiar with the matter said on Wednesday.
U.S. Steel has not opened its books to Cliffs; it will explore a sale, even as it accepts initial bids this week from other potential acquirers, because Cliffs will not agree to its conditions, the sources said.
U.S. Steel has said it has received interest from "multiple other parties" in a potential deal involving the entire company or some of its assets, but has not named them. Reuters has reported that ArcelorMittal is one of the parties that has been working on a potential bid for U.S. Steel.”
I believe these ongoing and inconsistent business practices and campaign slogans should be enough history for the jury to issue a verdict that all interested parties can feel a sense of relief. No guilty charges made but USS is on record for not fulfilling some, not all, but a few of their announced intentions.
Steelworkers at Granite City Works have arguably proven to be the best foot soldiers over the years in fighting for stronger trade enforcement, offering domestic steel a wonderful window of opportunity to upgrade facilities and to witness enormous profitability.
Mr. Haney was a master at advanced storytelling and sales techniques. And in doing so, he demonstrated basic sales qualities and characteristics that you can apply today. I can see the similarities.