The US Department of Energy plans to subsidize the American subsidiary of a Russian steelmaker that competes with Fort Wayne based Steel Dynamics Inc.
But Steel Dynamics CEO Mr Keith Busse said that's not why he is opposed to a USD 730 million federal loan commitment for Severstal Dearborn LLC to supply steel to US automakers.
Mr Busse said that the deal will hurt American taxpayers when they can least afford it. He added that "The last thing SDI is going to do when this nation is suffering, as this workforce is suffering, as taxpayers are suffering, is going to go out there and ask for a handout. Yet we are willing to give it to a foreign national who is one of the richest men in the world? That doesn’t make sense."
Senators Mr Dan Coats and Mr Pat Toomey called for an inspector general to investigate the loan commitment, which would come through the Energy Department's Advanced Technology Vehicle Manufacturing Program. The senators contend US steelmakers already produce what Severstal will make at its expanded mill in Dearborn high strength, lightweight steel for the auto industry.
Mr Busse said that Steel Dynamics produces such steel at its Butler mill in DeKalb County. He added that "My major complaint isn't so much will Severstal gain a competitive advantage, the answer is yes, it's worth about USD 20 a tonne of steel. Can I deal with that? Probably, we are one of the best in the world at what we do. I'm not going to sit here and cry about it. But I don't think its right for the taxpayer to get involved in helping a billionaire fund his project."
OAO Severstal is spending USD 1.3 billion to expand three US mills, including the Dearborn plant. Russia's largest steelmaker is headed by Mr Alexey Mordashov, whom Mr Busse said he has had drinks with.
Mr Damien LaVera, press secretary for the Energy Department, responded to the concerns in an email. He said that "Severstal's application is for a project that would help make American car manufacturers more competitive as demand for lighter, more fuel efficient vehicles increases, strengthen the American steel industry and support more than 2,500 construction jobs and over 260 permanent manufacturing jobs in Michigan."
(Sourced from www.journalgazette.net)
