Steel Mills
AK Steel to Permanently Close Ashland Works
Written by Sandy Williams
January 29, 2019
AK Steel announced that it will permanently close its Ashland Works facility in Kentucky by the end of 2019. The blast furnace and hot end operations were idled in 2015, but AK Steel continued to operate a single hot-dip galvanizing coating line. Ashland’s 330,000 tons of loaded production will be transferred to other units in Indiana, Ohio and Michigan, resulting in nearly full capacity utilization rates at those facilities, the company said.
Shutting down the operation is expected to result in an annual savings of over $40 million, improving operating efficiency and lowering costs for the company.
“These savings, combined with the positive impact of the administration’s policies to address unfair trade practices, will help facilitate the company’s longer-term growth plans. It will also help maintain and enhance the company’s more cost-effective steelmaking facilities and further drive growth and innovation,” said AK Steel in its fourth-quarter earnings release.
Said CEO Roger Newport, “To be clear, this administration’s strong actions in addressing unfair global trade issues, including Section 232 tariffs, have strengthened our industry. However, global overcapacity, particularly from China, remains a systemic problem. This, along with recent U.S. announcements of new steelmaking capacity and restart of existing mills, will create more competition in the commodity steel market in the United States.”
President and COO Kirk Reich emphasized that the Ashland shutdown is permanent and what happens to the mill in the future will depend on offers or opportunities.
Ashland’s 230 employees will be offered positions at other facilities. Charges associated with the closure totaling approximately $80 million will be recorded in the first quarter of 2019.
Sandy Williams
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