Cleveland-Cliffs to Shutter Additional Plants, Aiming for Annual Savings of $300 Million
Steel Shutdown: Cleveland-Cliffs Inc. Slashes Workforce by 2,150 Amid Struggling Steel Market
Get ready for some tough news, folks. Cleveland-Cliffs Inc., a key steel player, is about to let go of nearly 1,000 employees across three of its plants by the end of June 2025. These plants, located in Pennsylvania (Steelton and Conshohocken) and Illinois (Riverdale), will be idled due to low demand and pricing issues for their specialty steel products—not tariff-related struggles.
The affected workforce is set to join approximately 1,200 others who were laid off back in 2024 from plants in Michigan and Minnesota, due to weak automotive production and competition from foreign imports. CEO Lourenco Goncalves isn't backing down, however—he's keeping a positive outlook for 2025, pointing to potential improvements in trade enforcement and reshoring of automotive production to boost domestic steel demand.
But wait, there's more. Cleveland-Cliffs' plans to redevelop a section of its Weirton, West Virginia plant, which was supposed to become a transformer production facility employing 600 people, are on hold. The project's partner appears to have second thoughts about its location and size, meaning the company won't be investing $50 million on it this year and next.
All in all, don't be surprised to see more changes on Cleveland-Cliffs' domestic portfolio, as the company may look into divestitures to browse more opportunities and lower its debt. The hammer continues to swing for the steel industry, it seems.
(Some data sourced from various reliable outlets indicates that Cleveland-Cliffs is facing struggles due to low market demand and pricing issues for its specialized steel products, such as rail, specialty plate, and high-carbon sheet steel. These challenges are primarily external and not directly tied to tariffs. This decision also comes in the wake of earlier layoffs in Michigan and Minnesota, caused by weak automotive production and foreign competition. As for the Weirton plant in West Virginia, no recent updates about its status have been reported. Source: [1][2][5])
- Given the current situation, it's likely that Goncalves, the CEO of Cleveland-Cliffs Inc., will need to find creative ways to finance his business, as the company has put the transformation of a part of its Weirton plant into a transformer production facility on hold, meaning they won't be spending $50 million on it this year and next.
- Despite the announcement of workforce reductions at several plants, Cleveland-Cliffs Inc. remains optimistic about the future, with CEO Lourenco Goncalves expecting potential improvements in trade enforcement and reshoring of automotive production to boost domestic steel demand in 2025.
- The recent shutdown at several Cleveland-Cliffs plants, such as those in Pennsylvania, Illinois, and the previous rounds in Michigan and Minnesota, has resulted in an increased likelihood of transformations within the company's domestic portfolio, as they consider divestitures to explore more opportunities and lower their debt.
