ArcelorMittal may close two service centers in France

The company cites a significant drop in customer activity in the industrial and automotive sectors

Steelmaker ArcelorMittal is considering closing two service centers in France as part of the restructuring of its Centres de Services business, the Journal de l’Economie reports.

The steelmaker said it may close its service centers in Reims and Denis. This decision may affect 130 jobs and has provoked a negative reaction from trade unions.

In a statement released this week, ArcelorMittal presented a project to reorganize its subsidiary ArcelorMittal Service Centers, which specializes in the wholesale of metals and minerals.

The company explained that it has faced a decline in activity among its industrial customers, especially in the automotive sector, and this trend has intensified in recent months.

Trade unions, in turn, are demanding social measures to limit the impact of the decision. Employees of the plant in Denis went on strike, and next week actions are planned at all French ArcelorMittal plants.

The steel company, in turn, has pledged to start negotiations with trade union representatives to discuss support measures.

ArcelorMittal’s restructuring is taking place in a difficult context for the European automotive industry, which in the first half of 2024 recorded a reduction of 32,000 jobs among equipment manufacturers. The consequences are felt throughout the supply chain, especially in the steel sector.

According to Argus Media, further consolidation and restructuring is expected across the European service center market due to the drop in real consumption and the financial difficulties this situation has caused for some processors.

For example, Bilstein, a German cold-rolled steel producer that sells products primarily to the automotive sector, will reduce its workforce and is considering closing one of its five lines or reducing work shifts at all of its facilities. Thyssenkrupp, the largest steel producer in Germany, has closed some of its distribution centers in the country.

As GMK Center reported earlier, European car producers are experiencing difficulties due to high production costs, fierce competition and stagnant demand for electric vehicles in the main markets for these products.