But even if the USWA is more accommodating on wage and pension issues, it still will demand an answer to the Trico question, and those talks could become rancorous. In another interesting negotiation, Ispat Inland's facilities now are under foreign ownership. Bitter, difficult contract talks could discourage additional investment by foreign companies in domestic mills. In 1992, Ispat's proposed purchase of Bethlehem Steel's former Bar, Rod, and Wire Div. in Johnstown, Pa., fell through when Ispat and the USWA couldn't agree on a new contract. The USWA also has indicated that it won't sign long-term contracts, as it did in 1993.
Steelmakers benefit from the longer contracts because it reduces uncertainty.
As Associate Editor Craig Woker reports, mergers and acquisitions have been picking up since 1994. Some domestic steel stocks, which many steelmakers complained were undervalued during the recent prosperous times, have been plummeting in recent months. At these prices, foreign companies could become very interested in steelmakers in the strong North American market, says Lou Pahountis, an associate partner in the global metals division of Andersen Consulting. European steelmakers have been privatized and now want to grow, says Henry Harnischfeger, a managing director at J.P. Morgan. This is true of Latin American producers as well.