Ohio Steel Industry Advisory Council
Spring 1997
Aide
wins putter
Customer choice on electricity
Divide Conrail
Legislative Outlook
Ohio State professor joines Council
On the Steel Front
Quarterly report text
Save weight and dollars
Steel Front sidebars
Aide
to Ohio Senator
Blessing Wins Putter Congratulations to
Sam Grossmann, aide to Ohio Senator Louis W. Blessing of Cincinnati, who
won an OdysseyTM putter in a drawing sponsored by the Ohio Steel Council.
He was among those who qualified for the drawing by responding to an Ohio
Steel Report readership survey, the results of which will be published
in the next issue.
[back
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Official Urges Ohio to Move Faster
Toward Customer Choice for Electricity Ohio needs to move
more quickly toward customer choice for electricity to preserve and enhance
the competitive position of steel and other Buckeye State industries,
according to Joseph F. Toot Jr., president and chief executive officer
of The Timken Company in Canton. Speaking at a recent
power deregu-lation conference, Toot said neighboring states and the rest
of the world are moving toward choice faster than Ohio. Many of the steel
industry's competitors operate in those areas. "Competition combined
with customer insistence on better costs both suggest that we make this
transition far more quickly than now suggested," Toot said at the power
conference, sponsored by the Ohio Chamber of Commerce and several industry
groups. "The customers of our electrical utilities are simply not going
to stand by while others achieve benefits which are denied them. "Let's build a program
that brings about these changes far more rapidly than we now contemplate." Ohio lawmakers have
formed a joint legislative task force to review the deregulation of the
electricity industry and issue a report later this year. Lawmakers and
power industry executives have estimated it could take well into the next
decade to achieve true competition. Because energy costs
affect the costs of end products, they influence the competitiveness of
the steel industry and its customers, Toot said. They also affect the
consumer's willingness to purchase end products. Projections indicate
electricity bills could fall as much as 20 percent during the five-year
period following deregulation. "It is not enough
to be content with producing the lowest energy costs," Toot said. "In
today's world, it is the lowest cost of the end product which counts." The Ohio Steel Council
has signaled its strong support for customer choice for electricity. The
Council's nine member companies purchased more than $300 million of electricity
in 1996 to run their Ohio plants. A similar amount is spent on electricity
through purchases from suppliers.
[back
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Steel Producers Study
Compromise Plan to Divide Conrail Ohio steel producers
are taking a "wait and see" position on the recently unveiled compromise
plan to divide Conrail Inc.'s rail lines between Norfolk Southern Corp.
and CSX Corp. Like other shippers,
steel officials believe the compromise plan appears to be better than
previous plans unveiled by the two Conrail suitors. "The railroad issue
has been of great concern to Ohio steel producers and will continue to
be watched very closely as this effort to divide Conrail unfolds," said
Harold V. Kelly, co-chairman of the Ohio Steel Council and executive vice
president and general counsel of Republic Engineered Steels, Inc. in Massillon. "Steel companies must
have access to key rail lines as well as competitive rates. While this
alternative seems to be better than either of the previous merger attempts,
the new plan must be carefully studied to determine the impact on individual
steel companies." Earlier this year,
the Steel Council raised concern over the possible merger of Conrail and
CSX, contending the move could lead to reductions in service or higher
rates. The Steel Council also said Norfolk Southern's competing bid for
Conrail could limit competition. In the wake of opposition
from steel producers and others, the compromise plan was developed to
divide Conrail's lines between CSX and Norfolk Southern.
[back
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Preserved for License Plates Legislation that would
have removed Ohio's long-established preference for steel in license plates
was amended to preserve steel as the material of choice for that product. A bill supported by
the Ohio Bureau of Motor Vehicles would have allowed the BMV to select
steel and/or other materials for license plates. But state legislators,
led by Senators Scott Oelslager, R-Canton, and Anthony Latell, D-Girard,
amended the bill to strike the anti-steel provision. Ohio Steel Council
Co-Chairman Harold V. Kelly, executive vice president and general counsel
at Republic Engineered Steels, Inc. in Massillon, pointed out in a letter
that steel has served Ohio motorists well. New license-plate stock with
increased thickness and a heavier coating of zinc, which eliminates premature
corrosion, will enhance steel's performance, he said. Also, Kelly noted,
"Since Ohio is the second-largest steel-producing state, it seems only
prudent to retain steel as the official material of choice for license
plates."
[back
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State Professor Joins
Ohio Steel Council Dr. Nicholas G. Hall,
professor of management sciences and industrial and systems engineering
at The Ohio State University, has been appointed by the Ohio Board of
Regents to the Ohio Steel Council. Dr. Hall teaches masters
and undergraduate courses in management science and doctoral courses in
advanced manufacturing topics. He earned his doctorate
at the University of California, Berkeley. Since joining Ohio State in
1983, Dr. Hall has held visiting positions at the University of Pennsylvania,
Northwestern University and Saitama University in Japan. Hall has co-authored
almost 50 publications and made hundreds of academic presentations worldwide.
Hall also has consulted extensively with manufacturing companies and governments
regarding large-scale manufacturing and operations planning and major
public policy decisions.
[back
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Labor, Government
Leaders Celebrate Recycling Steel and labor leaders
joined public officials in the Statehouse Atrium in Columbus recently
to celebrate the growth of steel recycling across the Buckeye State and
the prominence of steel in our everyday lives. More than 140 individuals,
including 75 legislators and aides, attended the March 5 event, where
a steel-framed house, steel appliances, food from steel cans, steel recycling
displays and a steel-drum band provided a variety of entertainment and
education. "There is much more to the steel industry than blast furnaces
and steel mills that employ thousands of people," Harold V. Kelly, co-chairman
of the Ohio Steel Council and executive vice president and general counsel
at Republic Engineered Steels, Inc. in Massillon, told the group. "Actually,
our industry is your car, your refrigerator, the clip on your pen, many
parts of your computer and the cans that hold the food which nourishes
us. Tomorrow, it may very well be the material that frames your house.
It's already that for thousands of Americans today." Kelly and Ohio Senator
Gary Suhadolnik, R-Strongsville, a Steel Council member, were among those
who made remarks at the event. Other speakers included William Heenan,
president of the Steel Recycling Institute, and officials from the Ohio
Department of Development and Department of Natural Resources. Hors d'oeuvres and
vegetables served at the affair came packaged in steel cans, which are
becoming popular in the food industry. Food packaged in cans made from
steel tends to stay fresher and taste better. Also, steel cans - like
all steel - are fully recyclable. "We wanted to give
you a glimpse today of the recyclability of this product," Kelly said.
"There is no material on earth that is as recyclable as steel. Steel is,
in fact, 100 percent recyclable. There is a market for every piece of
recycled steel, and our companies buy thousands of tons of it every year." The event was the
most recent in a series of events the Steel Council has sponsored in the
five years of its existence to promote a greater understanding of the
importance of steel to Ohio's economy. Ohio is the nation's second-leading
steelmaking state. The Council, formed in 1992, is made up of steel, labor,
education and government officials. "One of our priorities
as a Council is to make sure our policy makers understand the enormous
impact steel has on the economy and well-being of our state," Kelly said.
"Our industry needs the support of state government if we're to continue
making a major contribution." Steelmakers employ
approximately 30,000 people in Ohio and generate significant spin-off
activity as a result of their high-volume purchasing and construction
budgets, Kelly pointed out.
[back
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STEEL DATA REPORT:
First Quarter 1997 Quarter
Ended March 31 1997
1996 % chg Steel Production (tons)
3,777,077 4,256,707 -11 Shipments (tons) 3,574,374
3,747,954 -5 Exports (tons) 58,914
42,565 38 Payroll $358,464,112
$397,326,301 -10 Average Employment
26,823 27,998 -4 Capital Investment
Spending $83,588,418 $76,890,575 9 State and Local Taxes
$29,146,493 $22,773,264 28 Healthcare Spending
$67,428,089 $66,222,080 2
[back
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Can Save Weight and Dollars in
Light-Duty Trucks, Sport Utility Vehicles The North American
steel industry has presented a study that documents potential savings
in weight, parts and costs associated with the design and manufacture
of sport utility vehicles and light-duty trucks. The American Iron
and Steel Institute commissioned the study as an outgrowth of the UltraLight
Steel Auto Body (ULSAB) project. "This represents an
innovative effort to ensure that steel remains the material of choice
in automobiles, while meeting the government's desire for more fuel-efficient
vehicles," said Robert T. Buck, senior vice president and assistant to
the president at LTV Steel Co. in Cleveland. "Steel is the best
material when it comes to reducing weight and providing consumers with
the safety and value they deserve." The ULSAB project
was started in 1995 by an international consortium of sheet steel producers
to develop cost-effective solutions to reduce vehicle weight and increase
fuel efficiency. In addition to LTV, the consortium includes two other
Ohio Steel Council members - AK Steel Corp. in Middletown and WCI Steel,
Inc. in Warren. The study proposes
designs that would reduce the number of parts in the body and frame, reduce
weight and save costs. The designs also allow for construction of sport
utility vehicles and light trucks on the same manufacturing line, resulting
in lower manufacturing costs. An optimized design reduces fuel consumption
and lowers environmental impact.
[back
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Front Sidebars Richard Wardrop was
named chairman of AK Steel Corp. in Middletown, and James L. Wareham was
elected company president. Wardrop joined AK Steel in 1992 as vice president
of manufacturing and later became president and chief executive officer.
He will continue as chief executive officer. Wareham most recently was
chairman, president and chief executive officer of Wheeling-Pittsburgh
Steel Corp. and president of its parent, WHX Corp. John Scheessele became
chief executive officer of Wheeling-Pittsburgh Steel Corp., which has
five Ohio locations, and president of WHX Corp. He previously was president
and chief executive officer of WCI Steel, Inc. Republic Engineered
Steels, Inc. in Massillon recently achieved ISO 9002 and QS 9000 certification
at its hot rolled and cold finished plants, adding to the special metals
plant's ISO 9002 certification in 1996. ISO 9002 is an internationally
accepted quality standard for management, and QS 9000 are automotive quality
requirements. WCI Steel, Inc. in
Warren has obtained certification under the automobile industry's QS 9000
quality systems standard, building upon the ISO 9002 certification that
the company achieved in 1995.
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