Olivier C. A. BISANTI

 
In the first part of this article, we reported the generation and the prosperity of USINOR, northern industrialist. Then we looked at the difficulties of what was called "the great crisis of the steel industry". In this second part, we will deal with the change of paradigm that led the steel industry to be entirely restructured to join the common economic field.
 

 
"Steel of France" - 1981 to 1994
 

During the period 1981-1994, the complete steel sector was restructured around the only technically and economically viable manufacturing units. This change was to cause the departure of 120.000 people out of the 160.000 that the steel industry counted in 1974. The economic context definitively changed; what had been called a "crisis" for twenty years, proved to be the introduction of a new paradigm: the late arrival of the steel industry into the economic game. As for the products, steel was no longer the standardised product manufactured since the beginning. If this term indicated a steel optimised for each application, almost all the steels produced today in Europe would be special steels. But the names of companies, sometimes related to place names, remained the same during all this reorganisation (and afterwards). This probably contributed to preventing a traumatised public to draw conclusions and see the phoenix reappearing out of its ashes.

(*) The pressures exerted against the more profit making steel exports became more insistent, as it was more and more likely to cause a shortage on the domestic market.

Paradoxically, it was during the time when the steel industry was nationalised that fundamental changes took place. The traditional times of the steel industry, which the elders named "the golden age", was when the customers queued up between 1945 and 1974, waiting until their orders were accepted (not "delivered"). Usinor, Sacilor and their colleagues were in a comfortable routine where the orders arrived all on their own. Up until 1974, the steel industry earned a lot of money and gave out dividends: this was an excellent investment. Private law companies, not civil servants, calmly exploited this secure income.

(*) The pressures exerted against the more profit making steel exports became more insistent, as it was more and more likely to cause a shortage on the domestic market.

Steel makers were accused of not having known how to rationalise the industrial mechanism, increase productivity, and therefore dismiss employees. The fact that these companies, very implicated in social environment, were very occupied with their personnel problems was forgotten, as well as the remonstrance's which they would have incurred from the authorities, who were always more or less distrustful of the heirs to the "iron masters". These authorities in fact already held the cords of the moneybags. Before 1982, the State had meddled indirectly but effectively in the business management of the steel sector. What Jean PADIOLEAU (See article) called "the liberal corporate State" consisted of an implicit co-administration between the State, the Trade Union and the principal industrialists of the steel sector. This co-administration consisted principally of compensation, from the State, in the form of credits (GIS or FDIS). There was not much control in the way they were used, or the loss of earnings, either real or imaginary, generated by the steel price freeze (*) before and in spite of the CECA (see particularly the article on Ph. MIOCHE.).

(*) The pressures exerted against the more profit making steel exports became more insistent, as it was more and more likely to cause a shortage on the domestic market.

It would be useless to recall the story of the modifications and closings of sites. The changes having been summarised, we will limit ourselves here in ("Usinor, story of a name") to tracking the career of old names through their new roles. It was in this way that in 1994, the name ' Usinor' didn't indicate any more a private northern company in the process of bankruptcy, but a public entity, amalgamated with its former Lorraine rival, ready to return to the private sector. In other words, in a position to exist on its own. The same old names were preserved but covered entirely different entities. "Usinor-Sacilor" thus indicated a company living from an activity of flat steels concentrated in a supposedly subsidiary company of the old name of "Sollac". This "Sollac" was no longer Lorraine, but a national company. Its industrial mechanism was distributed to the integrated sites of Dunkirk, Hayange-Serémange and Fos. The long products and the special steels were put to one side, waiting to pass into foreign hands in 1996 and 1999 (Unimetal with the Anglo-Indians of Ispat and Ascometal with the Italian Lucchini). How did the situation arrive like this?

(*) The pressures exerted against the more profit making steel exports became more insistent, as it was more and more likely to cause a shortage on the domestic market.

From 1978 until 1981, the year that the Socialists came into power, the collapse of the steel sector continued. The reduction of manpower started in 1976 (5000 people in the name of the CGPS) continued (16.000 people between 1979 and 1980). The new powers decided to more or less convert the "non-returnable" loans into actions. Taking into account the weakness of the own capital stocks caused by the extent of the losses, the State found itself shareholder with 76,5% of the Usinor capital. The same configuration was naturally reproduced at Sacilor.

(*) The pressures exerted against the more profit making steel exports became more insistent, as it was more and more likely to cause a shortage on the domestic market.

Those who pay, can order. The State made all the leaders of the two dying companies, who were yesterday's rivals, leave. The Trade Union of the steel industry, accused of all the evils, did not escape the purging. The time it took to make the inventory of fixtures and begin the convergence. Initially, Usinor and Sacilor, companies nationalised by decree in 1982, remained separate entities. At Usinor, it was Raymond LEVY who sat in the president's chair, in a head office transferred from the rue d'Athènes to La Défense. In 1982, 70% of Usinor's steel was uninterrupted cast and Dunkirk became the principal pole (4,4 MT). Amongst the multiple re-allotments and sectioning, the main fact remained the creation of the joint subsidiaries with Sacilor, first steps to a pure and simple fusion. It was in 1985 that Unimetal and Ascometal were made up. The same year, the flat steels at Usinor (Dunkirk, Mardyck, Denain, Montataire, Biache) were gathered into a subsidiary company named "Usinor-Steels". At the end of the year, Usinor yielded its shares in Sacilor to Unimetal.

On December 19th, 1990 there was a new change of structure. Usinor, the investment company, amalgamated with Sollac; Sacilor did the same in 1991 with Ugine-Steels of Châtillon and Gueugnon, to become Ugine S.A. The new mother company was known from then on as Usinor Sacilor (*) (without a hyphen). The 1991 economic situation was again bad following the Gulf War. The decision was taken to transform the Unimetal steel-works of Gandrange into an electric steel-works. After the closing in 1994 of SMNDN in Caen, only Sollac would be manufacturing steel starting from cast iron. The losses on the Unimetal long steel largely exceeded Sollac's benefit and the following working years were generally years of deficit. That is why the strategy of Usinor Sacilor was more orientated towards the only profitable production: coated flat steels, and some lines such as thick plate with high characteristics (tubes, etc), hot rolled high-strength plates (wheels)... The partitioning of the trades into distinct marks prepared the transferring of long products.

 
Usinor - 1995-2001
 

(*) The weight of the American funds for retirement in the capital (up to 40%) showed to which point Usinor Sacilor became healthy again in the eyes of these "distinguished economists".
(* *) In 1997, Usinor Sacilor simplified its trade mark and became..., Usinor for short.

Usinor was often to be heard of. Unimetal-Gandrange and the mini-factory of Montereau were sold to the British company ASW in 1995, the year that Usinor Sacilor was privatised (*). The factory Unimetal de Gandrange was yielded in 1998 to the Anglo-Indian company Ispat, whereas Usinor (**) took a participation, which became a majority participation in the Brazilian company CST and eliminated in the fight the Belgian Cockerill, both flat steel producers. It was an outstanding year, as Usinor became multinational. As for Ascometal, it passed in 1999 into the hands of Lucchini.

In front of the coalescence of its customers into large world groups, the steel industry also started to join together. The rival brothers Thyssen and Krüpp amalgamated, just like British Steel with Hoogovens le Batave. It was also a question of countering the rise of aluminium and, to a lesser part, composite materials. The adopted strategy was a scientific mixture of tactics and the game of Go. Usinor was present in the countries of its customers, and followed them when and where they moved, so as to exploit cheaper local labour (Spain, Brazil, Eastern Germany, Turkey), linking the continents together in order to offer to the customer only one interlocutor everywhere in the world. It put engineers in their engineering and design departments, where their expertise in steel appraisal would be a considerable asset to them. An asset both for rational use of existing products, "to feel out the market" and to direct the development of new grades. (Let us remember that the IRSID came under its control in 1991 with its 2100 people and 1,3 billion franc budget). Decisive commercial know-how developed to separate the heaviness of the tools from the flexibility of the solutions, and to propose "steel-solutions" instead of "simple" products. The network of co-operation even went to the Far East with the Japanese Nippon Steel.

The ink on this agreement was no sooner dry than the information came: fusion between Arbed and Aceralia would make the new unit, temporarily named "NewCo", the first producer of world steel, with a capacity of 46 MT of molten steel per year! The fusion brought back the long steels, Arbed's mainstay, to the new group's field of activity. But that is another story.

Just before the joint venture day that would cause its disappearance, what did the name "Usinor" cover? "Sacilor" had disappeared, only the scorn of History would make it possible to see the triumph of the former northerner over the Lorraine "iron barons". "Usinor" recovered today a company rebuilt from the interior, of which the most important activity was that of a company "Sollac", which was an old Lorraine name. Three factories: one to the North, the other in the East were the strongholds of the two former rivals; the edification of the third (with difficulty) had been led to good jointly. As for the logo, an elegant one was chosen derived from the old logo of Sacilor. It may be noted that one of the old northerners, Dunkerque, was at the time of the drafting of these lines, directed by an old director of... Solmer. At the time of their fusion, the integration of the elders from Elf and Antar had much delayed. It was true that they were not in danger of dying... Triumph, is also a question of tenacity.

 
And now?
 

At the time, the fusion of British Steel and Hoogovens had been named "Corus". The choice of this name was symbolic: "Core" is another word for "centre"; such is the place of the steel industry in the Western civilisation. As for "Chorus", it was probably the oldest collective cultural act of Man.

At the time these lines are written, we have still not been informed of the name that will succeed "Usinor". According to the rumours currently in force in the economic world, it will no longer have any relationship with the steel industry, nor with old-fashioned industry. Perhaps it will announce not a trans-national but a multi-continental meaning and thus a still broader culture.

The mark (StAlliance) indicates, in an explicit way, the respectful bringing together of identities. The prefix St recalls discreetly that it is about steel (Steel, Stahl), but it especially makes it possible to insert a significant initial into the logo. Circular so as to evoke the world influence of the Group, this logo exploits the initial, significant like the reference to the Eastern Yin-Yang, opening the way to other convergence's, which is also suggested by the absence of a border and any closed figures