Voestalpine sticks with US expansion

The Austrian steel producer, Voestalpine, has stated that it is sticking with its plans to expand into the US market despite the weak oil price.

The company that makes a variety of steel products including stainless steel has targeted the energy sector as one of its key growth areas and until recently had benefited from the US shale boom. But the recent plunge in oil prices since this past summer has seen energy firms slash investment plans, hitting their suppliers. Wolfgang Edger, CEO of Voestalpine, has commented, “The oil price is an interesting thing but … experience tells us it tends to be over-interpreted. We expect that things will already turn around again in autumn.”

Voestalpine plans to invest about 250 million euros ($283 million USD) in the United States during each of the next two years, mainly in its new sponge-iron plant in Texas, and about 50-100 million euros per year thereafter. Eder has commented that he could imagine the Texas plant getting involved in other activities beyond producing the sponge iron for which it was built, and said Voestalpine would like to strengthen its stainless-steel business in the United States.

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