"Now, ArcelorMittal (hereinafter referred to as "Amiga") has 200,000 tons of high-end automobile plates exported to China. It mainly supplies Volkswagen, GM, Ford and other joint venture companies in China. In October this year, these products will be transferred. To VAMA company sales." This year, the deputy general manager of Valin Iron and Steel Wang Jun, a new responsibility, as the chairman of VAMA company, responsible for the preparation of the joint venture automobile plate production companies.
VAMA is a joint venture between Valin Steel and ArcelorMittal, the world's largest steel producer. The advent of VAMA also means that the entity after the transformation of the cooperation between Valin Steel and Anmi was formally launched. Previously, Anmi, which had invested in equity through Valin Steel, did not receive the expected earnings. After the two companies focused their cooperation on the more profitable high-end automobile board projects, it is likely to be affected by Baosteel, Wuhan Steel, Anshan Iron and Steel, etc. Occupied by the domestic auto board market has brought no small impact.
Grab the high-end car plate market
VAMA Company is one of the few newly added investment projects jointly held by Valin Steel and Anmi after the financial crisis. The total investment of the project is 5.2 billion yuan, of which 51% is Valin Steel and 49% is Anmi.
At present, the automotive plate project is under construction of the main plant and is expected to be put into production in June next year. The annual production scale after the completion of production is 1.5 million tons, including continuous pickling and cold rolling mills with a capacity of 1 million tons, and a continuous hot-dip galvanizing line. The production capacity reaches 500,000 tons.
The new project of contrarian investment is because in the Chinese steel market, the automobile panel is one of the few steel varieties with stronger profitability. The annual report data disclosed by major steel companies shows that the gross profit margin of cold rolled products such as automobile plates is generally higher than other products.
“At present, the demand for automobile panels in China will increase by 1 million to 1.5 million tons every year. Products include Baosteel (joint venture with Nippon Steel), Guangzhou Steel (joint venture with JFE), Angang (joint venture with ThyssenKrupp), Wuhan Iron and Steel, etc. Providing that 1 million to 1.5 million tons of oil will be imported from Japan, South Korea and Europe each year, so there is a large market space.†Sanjay Sharma, CEO of ArcelorMittal China and CEO of VAMA (Sanjay) We told this reporter that while Anmi has a 20% share of the global automotive panel supply market, the market share of high-end automotive panels is even 35%.
Therefore, with the help of Anmi's technology in the high-end automotive panel industry and Valin Steel's experience in hot-rolled substrate supply and the domestic market, the two decided to switch from equity cooperation to automotive joint ventures.
"The company settled in Hunan also responded to the needs of domestic automobile production customers. The future growth of automobile production has come from the central and western regions." Wang Jun pointed out that at present, many automobile projects have started in Hunan, such as Shanghai Volkswagen, Beiqi, and Guangzhou Automobile. Hunan builds a new production base.
Waring Ling losses in the second quarter
The accelerating advent of auto sheet joint ventures can also be regarded as a new hope for the maintenance of “marriage†after the two banks re-adjust their cooperation strategy after the “marriage†of Banking Steel and Amoy eight years ago.
After Valin Steel suffered a huge loss, the two sides adjusted their cooperation model. Anmi gradually reduced its holdings of Valin Steel, which in turn increased its investment in joint venture auto board companies. One of the conditions for the reduction is to establish joint ventures with auto panels. Links to key progress nodes for construction and technology transfer.
At present, Anmi has completed the first phase of the sale of shares of Valin Iron and Steel, currently holding 25% of the latter's shares. After the installation of the automobile plate production equipment is ready for installation in the next month, Anmi will further reduce its holdings to Valin Steel. 20%, eventually retained a 10.07% stake in Valin Steel after the auto sheet production line was put into operation.
For Valin Steel, how to turn losses as quickly as possible is also a top priority. Last year, the company's loss amounted to 3.254 billion yuan. If it loses again this year, the company will be put on ST's hat.
“By increasing cost reduction efforts, the company has turned losses in the second quarter of this year. However, as the first quarter was still a loss, it has not been positive in the first half of the year, but it has substantially reduced losses by about 70% compared to the same period last year.†Wang Jun told this reporter that the company The possibility of turning losses in the year is still relatively large.
According to report, in the first quarter, the cost per ton of steel was reduced by about RMB 100 in the first quarter of this year. The company’s goal is to reduce the cost per ton of steel by RMB 240 to RMB 260 for the whole year.
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