Even as they narrow their focus to upscale markets, Big Steelmakers have less flexibility in production volumes because of their blast furnaces and high fixed costs. Minimills have less flexibility in the types of products they can make, but they have the big advantage that scrap prices go down when the general steel market goes down. As prices go down, minimills with big debts will be vulnerable. In 1980 Chrysler Corp. faced a much tougher situation than steelmakers do today. The minivan has been the mainstay of Chrysler's success since its introduction in 1983.
Steelmakers have similar opportunities in steel-framed housing and all the other kinds of niches.
Those who successfully pursue imaginative strategies will weather the next storm and emerge even stronger as the next century begins. Select another article. Return to New Steel home page.