Alabama Chosen $4.2 Billion Steel Plant

Friday, May 11th 2007, 7:24 am

By: News On 6

FRANKFURT, Germany (AP) _ Steelmaker ThyssenKrupp AG said Friday it will build a new $4.19 billion steel plant in Alabama, which has attracted other German companies including DaimlerChrysler AG in recent years.

The plant _ scheduled to open in 2010 and employ as many as 2,700 workers when fully operational _ will be near Mobile. The company was lured by several tax breaks and a $400 million incentives package.

The Duesseldorf-based company chose Alabama over Louisiana, which also had offered tax breaks.

It would be the company's first steelmaking operation in the United States, processing carbon steel and stainless steel for automakers, electrical companies, appliance manufacturers and more.

The new plant would be ``an integral part of the company's plan to increase growth in the steel and stainless steel division in North America and Europe,'' supervisory board chairman Ekkehard Schulz said in a statement.

The company said that once the plant is up and running, it could create as many as 38,000 new jobs related to the mill, from suppliers to transportation to dining and entertainment.

Low-cost slabs will be supplied from a new steel mill in near Rio de Janeiro that is scheduled to start production in 2009 with a capacity of 5 million tons of slabs per year.

The North American plant will process the slabs.

``This combination of cost and quality leadership can only be achieved with the new steel mill. At the same time, ThyssenKrupp is investing over 700 million euros ($946.89 million) to strengthen its German facilities and its market position in Europe,'' he said, adding that the special feature of the steel mill is that it will be a combined plant for flat carbon steel and stainless steel.

Shares of ThyssenKrupp were down 2.3 percent in midday trading.

The announcement after the company, one of the world's biggest steelmakers, said Friday that its second-quarter net profit fell 44 percent because of a multimillion-dollar fine levied by the European Union.

The company, whose products range from automotive parts and elevators to slabs of steel, earned 244 million euros ($330 million) in the January-March period, compared with 441 million euros a year earlier.