DOE offers Severstal a $730M conditional loan commitment for project to manufacture automotive advanced high strength steel
13 July 2011
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| Severstal participated in the Future Steel vehicle (FSV) program. Top: the BEV FSV uses 97% High-Strength (HSS) and Advanced High-Strength Steels (AHSS) of which nearly 50% reach into GigaPascal strengths. Bottom: % of body structure mass for each steel type, color-coded to images above. Source: WorldAutoSteel. Click to enlarge. |
The US Department of Energy (DOE) has offered a $730-million conditional loan commitment to Severstal Dearborn, LLC. The funding will support the modernization of existing facilities in Dearborn, Michigan, in addition to the design, manufacture, and construction of new facilities to produce the next generation of automotive advanced high strength steel (AHSS).
The facilities will produce a wide range of advanced high strength steels, which will enable manufacturers to reduce the weight of steel components used in vehicles, creating a 10% reduction in total vehicle weight while meeting increasingly stringent safety regulations. Severstal’s AHSS project has the potential to reduce petroleum-based fuels consumption by nearly 30 million gallons annually, and thus avoid over 260,000 metric tons of carbon dioxide emissions.
Future Steel Vehicle Program. Severstal is one of 17 global steel makers to complete Phase 2 of the Future Steel Vehicle program (FSV). FSV has added the most advanced steel products and technologies to its portfolio, utilizing more than 20 new Advanced High Strength Steel (AHSS) grades, representing materials expected to be commercially available in the 2015 – 2020 technology timeline.
The FSV material portfolio includes dual phase (DP); transformation-induced plasticity (TRIP); twinning-induced plasticity (TWIP); complex phase (CP); and hot formed (HF) steels, which reach into GigaPascal-strength levels and are the newest in steel technology offered by the global industry.
As announced by the WorldAutoSteel organization in May, the FutureSteelVehicle (FSV) features steel body structure designs that reduce mass by more than 35% over a benchmark vehicle and reduce total life cycle emissions by nearly 70%. This is accomplished while meeting a broad list of global crash and durability requirements, enabling five-star safety ratings, while avoiding high-cost penalties for mass reduction.
The FSV program developed optimized Advanced High-Strength Steel (AHSS) body structures for four proposed 2015-2020 model-year vehicles: battery electric (BEV) and plug-in hybrid electric (PHEV) A-/ B-Class vehicles; and PHEV and fuel cell (FCEV) C-/D-Class vehicles.
FSV’s BEV concept weighs 188 kg and reduces mass by more than 35% over a baseline ICE body structure adjusted for a battery electric powertrain and year 2020 regulatory requirements. FSV’s A-/ B-Class PHEV20 vehicle weighs 175 kg, and the larger C-/ D-Class vehicle versions weigh 201 kg.
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Very odd to see that something as basic as steel making need government loans. Where is free enterprise going? Somebody is transgressing the basic.
To pull out of current deficits, Fed and States could lower all wages and pensions they pay by 1% for each $10K of individual gross annual income. Low salary and pensioned people would not be touched much but high paid positions such as: Senators, Congressmen, Secretaries, high level advisers, Professionals, Generals, Judges etc and of course the President would justly take much larger $$$ cuts.
One party (rep) should really like that approach...i.e reduced spending starting August 1st, 2011.
If 1% per $10K is not enough it would be easy to make it 2%.
Posted by: HarveyD | 13 July 2011 at 12:39 PM
Please hear me out:
We have a great dilemma in our country: Should we wipe out the middle-class and have rich people and poor people to see to the rich people's needs. It's your decision to make; The Republican agenda that includes a small middle-class or the Democrats idea of continuing to provide a path to achievement by following the idea of Government helpimg maintaining a large middle-class; at this time the Republican agenda is winning as Congress and The President agree to welfare for the elite class.
Foremost among the support for rich people is the tax breaks and subsides for Big Business. Remember the Republican believe that programs for the people are all social programs and that includes Social Security, Medicare, the public school system and subsiding startup businesses. Think before you vote next time...please!
Posted by: Lad | 13 July 2011 at 02:48 PM
LAD: For USA to survive:
1. governments will have to immediately reduce spending (by 10% or more) and increase revenues (by 10% or more), specially from people and enterprises that can afford it.
2. governments should start to collect all the $$$B they have given to rich firms and banks even if it hurts.
3. people will have to use a lot less (-30% to -60%) imported fossil fuels by using much smaller more efficient vehicles, including electrified units.
The elastic ban (credit) cannot be stretched forever.
Posted by: HarveyD | 13 July 2011 at 04:54 PM
Pretty simple, really. Go back to the Clinton Tax rates. They were more progressive. They were at a percentage of GDP that covered historical spending needs. They allowed tremendous jobs growth and over all economic growth. That and end a few wars and shift spending to growth segments that enable economic development (green industry, job retraining, smart grid, deferred infastructure maintenance, some really big solar farms) and away we go.
Posted by: HealthyBreeze | 13 July 2011 at 06:49 PM
Amen HB
Posted by: JMartin | 13 July 2011 at 07:01 PM
Yes HB, what works is clear, what does not work is clear.
Posted by: SJC | 14 July 2011 at 04:59 AM
HB has my vote.
Posted by: DaveD | 14 July 2011 at 08:28 AM
Is it too late to but W. Clinton back into the drivers seat?
USA urgently needs somebody like him.
Posted by: HarveyD | 14 July 2011 at 08:51 AM
We have a good President that is trying to do the job, if members of the opposition party would just be reasonable for once.
Posted by: SJC | 14 July 2011 at 09:53 AM
Yeah well, don't hold your breath waiting for THAT to happen.
Posted by: ai_vin | 15 July 2011 at 09:12 AM
Is it too late to fix the USA economy, regardless of who is it power?
May be so!
Too bad because this Wall Street failed economy may take the rest of the world with it and we could have 1929 all over again.
Posted by: HarveyD | 15 July 2011 at 11:47 AM
This can be fixed, we did it in the late 90s. We just need a group that is willing to be practical and not be so stubborn in their ideology. Most of the Republicans think we need a balanced plan that includes revenue.
Posted by: SJC | 15 July 2011 at 11:56 AM
Is it now required for all capital investment that it be subsidized by the State before it is undertaken? Of course not. The steels that this facility is to make, only duplicate similar steels produced by US and other foreign steel makers. Why should Severstal be subsidized then?
Is it because they are politically connected? Why should other steel makers spend their own R&D funds and capital investment monies to pioneer low alloy, ultra strong steels, only to have a laggard with political connections, use government money to catch up?
The US steel industry went through a wrenching 30 year reorganization and set of bankruptcies, from 1970 until 2000, to emerge as a world leader in both low cost, and high quality of steels produced. But casual observers of the scene would never know that, as it does not fit the picture of loss of jobs and migration of industry overseas.
The discussion of the uses of high strength steels is just eye wash, as most auto makers already use high strength steels for more than 60% of their car bodies today. Where does that high strength steel come from? From Severstal unsubsidized competitors, obviously.
Our now thoroughly modern steel industry makes most of its steel in enlarged, high quality, tool-steel based, electric arc furnaces pioneered by the miniMills non-union companies. It uses vast quantities of recycled scrap steel, as 95% "steel ore", which requires much less processing to make new steel.
It is much more energy efficient than starting with 2-3% virgin iron ore, and uses a source of material unavailable to third world countries, vast quantities old scrap steel, that this long industrialized country has amassed.
In a sense the US steel industry is a enviro' hearts desire. The US steel industry unlike others, is now a fully sustainable, recycle-based industry. What little proportion of new steel that is needed, well under 10%, is produced in Basic oxygen furnaces, that are also the State of the Art.
Why should this laggard foreign steel maker be subsidized, to duplicate what the other modern steel makers have pioneered and developed over the past 40 years? It is because otherwise useless bureaucrats must justify their jobs, and Severstal's antiquated Rouge facility is unionized, and very highly politically connected.
The steel industry was the pattern of reorganization recommended by the business man, turned Senator for Tennessee, to reorganize the auto industry without dragging it out for 30 years. His recommendations were carried by Democrats to incoming Mr. Obama, who adopted them. But accomplishing the same thing in 60 days of Bush government-financed planning, and then a mere 30 days in actual Obama government-financed bankruptcy.
It is amazing what good can be accomplished, if you let others claim the credit.
Posted by: ExDemo | 17 July 2011 at 11:04 AM
Indeed this is not pure free enterprise but even though Severstal might be an “evil big business” socialists must not dispair:
• there are bigger more evil companies
• it is unionized
• it is Russian owned
Yes “We have a great dilemma in our country”: Should we wipe out the tax paying class leaving the rich (who are the money and power brokers, [but they DO pay more taxes that anyone else; more $, but less %, what's fair]) and the increasing number voters who GET rather than PAY taxes.
The Republican agenda includes a middle-class, that are not burdened with supporting all those others that are "entitled".
The Democrats idea is of Government taking more and more of the peoples money and redistributing it as if the Government had the wisdom OR THE DESIRE to be fair; at this time the Republican agenda is winning.
Yes HB, what works is clear, what does not work is clear.
America became great, and most of us think it still is, not by rewarding failure and by not having the government distribute our wealth.
This can be fixed. We just need a group that is willing to be practical and not be so stubborn in their ideology. Most of the Republicans think we need a balanced plan that includes revenue.
Most of the Democrats think we should spend more, no matter what the effect, the next generation does not vote. If it gratifies, do it.
Let this type of government mature and succeed in Cuba, China, Russia and N. Korea first, then adopt it.
Except Russia is wandering in the wilderness and China is trying government controlled capitalism.
And when government extends its control to business the people lose.
Posted by: ToppaTom | 17 July 2011 at 01:00 PM
They do not have to take the assistance if they do not want to. Range Fuels took some government money and Choren did not. Range was using a different method that looked like it had some advantages.
Posted by: SJC | 18 July 2011 at 08:06 AM