German steel industry opinions diverge on carsharing

The idea of carsharing and what it means for steel suppliers has not been discussed too widely in the steel world. Just lately however some diverging views have surfaced on the topic within the sector.

“Society will need fewer cars in the future, and possibly less steel in the cars that will be built,” says Klöckner & Co’s ceo Gisbert Rühl when asked about the issue. He says that a privately-owned car runs for about 2 hours per day on average, whereas a shared car is used for some 30% of the day, or 7-8 hours. That means fewer cars sold, “… and it is a development that is coming faster than many deem possible,” he told Kallanish on the sidelines of the recent Handelsblatt/Euroforum conference in Düsseldorf.

On the conference’s second day, however, steel managers such as Paul Brettnacher of ArcelorMittal Europe offered a different opinion. Given that shared cars are used much more than privately-owned cars, they will need replacement relatively earlier, which will maintain car-production, and hence steel usage, he and others suggested.

Meanwhile, Germany’s automotive suppliers’ interest group, ArGeZ issued its outlook for the industry at the fair in Hanover. In 2018, car industry revenues totalled €264 billion ($296 billion), an increase of 3% year-on-year, whilst capacity utilisation rose to 87%.

ArGeZ spokesman Christian Vietmeyer, who is also the managing director of steel and metal fabricators’ federation WSM, notes that passenger car production so far this year remains steady. The falls in output that happened due to the WLTP procedure are “… only an aftermath now,” he says. Signals from China are ambivalent, whilst production prognoses in the UK and the US have become difficult due to the risks of Brexit and the imposition of tariffs respectively.

He also referred to the recent requirement by one major automotive producer that tier suppliers should lower costs and prices. “We are facing numerous challenges in emission-free drives, autonomous cars etc., which will affect the entire production chain,” Vietmeyer says. “Therefore, it does not fit in at all if an OEM creates unilateral cost pressures.”