2005-2006 Financial Statements and Management Report

50
WE HAVE SEVERAL
STRATEGIC OPTIONS IN
THE NAFTA REGION.
In Europe we will strengthen our outstanding market position with additional investments. In Duisburg
a new replacement blast furnace will be installed to secure our crude steel base. In addition we are
investing €400 million in Duisburg to remove bottlenecks in individual production steps and rationalize
the production flow.
In the nafta region we are pursuing various options. By acquiring the Canadian steel producer
Dofasco we could quickly achieve a strong position on the North American market for high-quality
flat products. This takeover is a high priority for us. As an alternative to the acquisition of Dofasco we
are looking into establishing a new plant in the usa which could be built and used jointly by the Steel
and Stainless segments. At the hub of this facility would be a hot strip mill which would mainly process
slabs from the new steel mill in Brazil. The new plant would also feature cold-rolling and hot-dip coating
capacities for high-quality carbon steel flat products. The search for a location is currently under way.
The location must offer optimum logistics – for slab supplies from Brazil and for the distribution of end
products to North American customers.
The Stainless segment, too, aims to expand its international position and continue to participate in
the steady growth of the stainless market. The main focus is on the North American market. We are
therefore examining the possibility of establishing extensive capacities for stainless flat products at the
joint location with the Steel segment in the usa. The stainless steel slabs produced in a 1 mt capacity
melt shop could be processed on the hot strip mill. In addition we aim to invest in a cold-rolling facility
which will be designed initially to produce 325,000 tons of cold strip and 100,000 tons of pickled hot
strip. Our Mexican stainless steel plant ThyssenKrupp Mexinox could then also be supplied with starting
material directly from the new plant in the usa.
Stainless is the world market leader in stainless flat products and nickel alloys. Outside Germany it
has production capacities in Italy with ThyssenKrupp Acciai Speciali Terni and in China with Shanghai
Krupp Stainless, as well as the operations in Mexico.
In addition to the planned expansion, we aim to increase value added both in stainless flat products
and in high-performance nickel alloys and titanium. To achieve this goal, a number of investments are
planned both for the production plants and in the service center organization. By investing further in
nickel alloys and titanium production, we will increase our share of the fast-growing aerospace and
energy markets.
Innovative capabilities a strategic strength
Technological competency and constant innovation are the key to the market for capital goods on
which the Technologies segment operates. Following its concentration on high-earning business units,
Technologies is now well equipped to maintain and further improve on the outstanding positions it
has achieved in its individual areas of activity. Over the next few years we will strengthen our market
position as an international supplier of leading-edge technology in mechanical engineering, plant
construction and shipbuilding. International investments and acquisitions will contribute to this. For
example, we plan to expand production of industrial large-diameter bearings in Germany, India, Japan
and China.
In shipbuilding, the takeover of HDW has opened up new opportunities, especially for our innovative
submarines with fuel cell propulsion. The acquisition of a 60% shareholding in Atlas Elektronik has also
provided Technologies with strong capabilities in marine electronics. Our own expertise, for example in
plant technology, is also in demand for the expansion of the Asian economies.