Germany’s largest steelmaker, Thyssenkrupp Steel, is curtailing production of a critical component for Europe’s energy infrastructure-grain-oriented electrical steel-amidst increasing competition from asian imports. The move, impacting facilities in Germany and France, highlights growing concerns over the resilience of european supply chains and the potential for disruptions to the energy transition [[2]]. With only two remaining manufacturers of this specialized steel in Europe, Thyssenkrupp’s decision raises questions about the continent’s strategic independence in key materials and could effect approximately 1,200 jobs [[1]].
Germany’s largest steelmaker, Thyssenkrupp Steel, is temporarily halting portions of its production of electrical steel following a surge in low-cost imports, primarily from Asia.
The move, announced by the company, comes as a response to increasingly challenging market conditions characterized by squeezed prices and declining demand impacting the European steel industry. Thyssenkrupp’s decision underscores the growing pressure on European manufacturers facing competition from overseas producers.
Production Cuts at European Facilities
Table of Contents
- Production Cuts at European Facilities
- Critical Material for Energy Infrastructure
- Approximately 1,200 Jobs Potentially Affected
- Source: Handelsblatt, © 2025 Handelsblatt Media Group GmbH & Co. KG
- Fact:Electrical steel, or electrosteel, is primarily used in transformers and electric motors. The EU has been discussing protective tariffs and other trade policy measures for several years to limit imports of low-price steel varieties from countries outside the union.
Starting in mid-December and continuing through the end of the year, facilities in Gelsenkirchen, Germany, and Isbergues, northern France, will be completely shut down. Following the new year, further reductions are planned, with the Isbergues plant operating at just 50% of its total capacity for at least four months beginning in January.
According to Thyssenkrupp, the decision is a direct consequence of the significant increase in low-priced imports, particularly from Asian manufacturers. The company reports a sharp decline in order volumes, leading to substantial underutilization of its European production facilities. These conditions have prompted the company to take immediate action to stabilize its financial position.
Critical Material for Energy Infrastructure
Thyssenkrupp Electrical Steel manufactures specialized steel for the energy sector, specifically grain-oriented electrical steel used in power transmission and found in transformers at substations and wind turbines. The company notes that only two manufacturers of this type of specialized steel remain in Europe.
This situation raises concerns about Europe’s reliance on imports for materials crucial to critical infrastructure. The company is facing intense competition from lower-cost producers outside the European Union, a long-standing challenge for European steel companies.
Approximately 1,200 Jobs Potentially Affected
Thyssenkrupp Steel’s chief executive, Marie Jaroni, emphasized the importance of the production for Europe and warned of the potential consequences if it were to cease.
“Grain-oriented electrical steel is indispensable for the European energy infrastructure and the energy transition. We are working intensively to maintain production in Europe and are now seeking effective market protection to ensure fair competition for this strategically important product,” she stated.
The company estimates that around 1,200 jobs at the Gelsenkirchen and Isbergues plants could be affected. While no concrete announcements regarding potential layoffs have been made, Thyssenkrupp has not ruled out further measures if market conditions remain unchanged.
The pause in electrical steel production comes as Thyssenkrupp recently reported a return to profitability, but also cautioned that the full year could end with a net loss. This situation illustrates the structural problems facing parts of the European steel industry, dominated by global overcapacity and price pressures.
