2001: Changing to a downstream strategy 3 minutes spent reading
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2001: Changing to a downstream strategy

Volkmar Held
As a freelance writer, Volkmar Held reports for voestalpine on topics that move people. The content of his stories ranges from archaeometallurgy to future technologies.

The new voestalpine strategy implemented in 2001 extended the value chain and secured the Group’s position in the steel processing sector.

2001 DownstreamFollowing detailed preparations in 2001, VOEST-ALPINE STAHL AG— under its new name voestalpine AG —adapted both its organization as well as its operating structures to the changed economic framework conditions.

New structure created

The new ‘voestalpine’ wordmark expressed the new strategic direction being taken by the Group at the start of the new millennium far more clearly. ‘Steel’ was no longer part of the Group’s description. The flat and long product sectors were replaced by an organizational structure based on four segments.

The

  • Steel,
  • Railway Systems,
  • Profilform, and
  • Motion

divisions reflected the focus along each of the value chains. This also completed the structural reorganization from steel producer to a ‘steel-based processing group’.

Value chains extended

In 2001 the steel companies Arbed, Usinor, and Aceralia merged to become the world’s largest steel group, Arcelor. An extensive expansion such as this was not what the voestalpine strategists were intending in their long-term planning. Instead, by consistently adopting restructuring measures and through acquisitions, they extended the value chains, and particularly in the growing railway systems and automotive industry sectors. Group companies in the supply chain included leading direct suppliers to premium manufacturers, such as Polynorm, acquired in 2001.

Positive impact on the share price

Not being focused entirely on steel production (slogan: “Not more steel, but making more out of steel”) was supposed to reduce voestalpine’s dependence on the steel cycle. Analysts, who evaluate companies for banks and investors, called this as a very positive approach in their recommendations. The new strategy, which is implemented consistently, ultimately has had a sustained positive effect on the share price.
Peter Strahammer was involved in a tragic fatal accident in August of 2001. He had been the Chairman of the Management Board since 1994. He was succeeded by Franz Struzl.

Two decades ago voestalpine AG started out on its path to becoming a privatized and exchange-listed company. The ‘IPO 1995—20 years on the stock exchange’ series describes key events on the path to becoming an internationally successful steel-based technology and capital goods group.
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