As part of a larger set of operational changes, Cleveland-Cliffs said that it will no longer be deploying capital toward the development of a transformer production plant in Weirton, West Virginia (earlier post), due to changes in scope from the project partner that no longer meet Cliffs’s investment requirements.

Last July, Cleveland-Cliffs said that it would invest $100 million and be supported by a $50-million forgivable loan from West Virginia to build a distribution transformers plant that would employ 600 people. The factory would use grain-oriented electric steel from Cliffs’ plants in the region to help meet soaring demand for transformer equipment. Hitachi Energy CEO Andreas Schierenbeck recently told T&D World the average lead time for transformers is now 115 to 130 weeks, up from 24 to 36 before the COVID pandemic.

Our first-quarter results were negatively impacted by underperforming non-core assets and the lagging effect of lower index prices in late 2024 and early 2025. As a result, we are taking decisive action to streamline our operations and enhance efficiency. This will drive meaningful fixed cost savings and sharpen our focus on our core strength: supplying steel to the automotive industry.

The Trump Administration has shown strong support for both the steel and the automotive sectors, and Cliffs is uniquely positioned at the intersection of these two industries. As a result of the actions taken by the Administration designed to boost the production of vehicles in the United States, we have already arranged higher volume commitments with our automotive OEM customers, and we now have a clear line of sight to recover the stable EBITDA base that the automotive business has historically delivered.

The decision to fully or partially idle certain locations was not taken lightly. These actions will allow us to consolidate operations, withdraw from loss-making businesses, and deliver annualized savings exceeding $300 million. We are also strategically repositioning our portfolio away from non-core markets, including rail, high-carbon sheet, and specialty plate products. Importantly, with the upcoming restart of the Cleveland #6 blast furnace offsetting the upcoming idle of the Dearborn blast furnace, we expect no impact to our flat-rolled steel output. At the same time, we are actively managing pellet inventories and unlocking working capital built up in 2024.

Looking ahead, the conclusion of our five-year slab contract with ArcelorMittal/Nippon Steel Calvert at year-end—nearly 10% of our total shipments—presents a significant opportunity. This agreement has been a major negative contributor for us for several quarters. Despite rising HRC prices, the pricing structure of this agreement has moved in the opposite direction. That said, this contract goes away toward the end of this year and, at today’s pricing levels, the contract termination will represent an approximate $500-million benefit to our annualized EBITDA from today's levels, beginning in 2026.

—Cliffs’ Chairman, President and CEO, Lourenco Goncalves