Five Forces Analysis of the Steel Industry.docx - Five...

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Five Forces Analysis of the Steel Industry. For a long time the steel industry was seen as a static and unprofitable one. Producers were nationally based, often state owned and frequently unprofitable. The early 2000’s saw 50 independent steel producers going into bankruptcy in the U.S. alone. But there then followed a surge in confidence. During 2006 Mittal Steel paid $35bn to buy European steel giant Arcelor, creating the world’s largest steel company. The following year, Indian conglomerate Tata bought Anglo-Dutch steel. But these acquisitions were made just before the onset of the Great Recession in 2008 and further turmoil in the steel industry at large. New Entrants. In the last two decades, China has become a major force in the world steel industry. Between the early 1990’s and 2011 Chinese producers increased their capacity seven fold. Although the Chinese share of world production reached over 45% by 2011, most of this was directed at the domestic market.

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