...market. By 2000 global productivity increased and foreign steelmakers had entered the United States market causing what was perceived as a threat to domestic businesses. At this time, American steelmakers pressured the United States government to provide protection from imports leading President George W. Bush to put in place steel import tariffs under Section 201 of the 1974 Free Trade Act by March of 2002 (Robertson 2002). These protectionist measures imposed an average 30 percent tariff on selected foreign steel entering the United States. During negotiations, The International Trade Commission (ITC) recommended imposing a 40 percent commission while some extremists proposed 80 percent (Ho 2003). Although steelmakers were content with the implementation of the tariff as it provided some relief from imports, critics argued against the effects it would have on steel consuming businesses (Carbaugh 2011). The American Institute for International Steel (AIIS) felt that this tariff did not support free trade. The AIIS also believed that the steel tariff did not force companies to work in a price-competitive environment. David Phelps, president of the AIIS, believed in survival of the fittest. Phelps said that without protections such as these, strong companies would survive and weaker players would be eliminated (Robertson, 2002). With the key arguments from the U.S. auto makers, tariffs from some steel were revoked as it would have had more of a negative impact on the end consumer and...
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...What are the primary competitive forces impacting U.S. steel producers in general and the producers like Nucor that make new steel products via recycling scrap steel in particular? Please do a five-forces analysis to support your answer. http://www.slideshare.net/sizzlingmayank/strategic-management-4836230 1. -Porter’s Five Forces Analysis of Steel Industry in the United States of America Threat of new entrants Bargaining Power of Suppliers Bargaining Power of Buyers Internal rivalry within Industry Threat of Substitutes 2. Bargaining Power of Buyer’s a. With an increase in domestic competition in steel sector in the USA, the options for buyers are on a rise. b. Low Product Differentiation. c. Switching costs is low. d. Buyers buying in large scale posses strong negotiating power. Buyer’s Market !!! 3. Bargaining Power of Supplier’s a. Scarcity of raw-materials like steel shreds, iron ore, coke, recycled steel. b. Few Suppliers. c. Most of the raw-materials are imported. Cost strategy drives Joint ventures, Mergers and Acquisitions between suppliers and manufactures !!! 4. Major players in the United States of America Major M&A involving foreign partner 5. Internal Rivalry a. Domestic market – more than 20 players. b. Intense rivalry – Price wars. c. No differentiated product. ...
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...Security Analysis Alcoa and Arcelor Mittal Economic Analysis TheUnited States, despite its previous struggles, still finds itself as the most powerful economy in the world with a per capita GDP of $46,000. The United State’s is able to maintain its lead largely in part to the country’s market oriented economy. Currently, the President, in conjunction with government is attempting to bring the United States out of the contraction that plagued the economy for the past few years. The global economic downturn in 2008, spurred by the sub-prime mortgage crisis, and investment failures played a significant role in a GDP contraction rivaled only by the Great Depression. With the onset of technology over the past decade, the United States economy now stands witness to a “two-tier labor market”.This type of market implies that those on the bottom of the market lack the professional/technical skills that their counterparts possess.Those who are in the upper-half have seen the majority of the gains in household income since 1975. This imbalance with the average household income failing to match the inflation rate put the economy in dire need of relief. In 2008 President Barrack Obama issued an asset relief program to help calm the fire. This relief came in form of the Trouble Asset Relief Program (TARP). The program issued 700 Billion in relief to help the economy in October of 2008. In addition to the TARP program, Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection...
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...INTRODUCTION The United States Steel Corporation more commonly known as U.S. Steel is an integrated steel producer with major production operations in the United States, Canada, and Central Europe. The company was the world's 13th largest steel producer in 2010. It was renamed USX Corporation in 1986 and back to United States Steel Corporation in 2001 when the shareholders of USX spun off the oil & gas business of Marathon Oil and the steel business of U. S. Steel to shareholders. In 2001 it was still the largest domestically owned integrated steel producer in the United States, although it produced only slightly more steel than it did in 1902, after significant downsizing in the 1980s. U.S. Steel is a former Dow Jones Industrial Average component, listed from April 1, 1901 to May 3, 1991. It was removed under its USX Corporation name with Navistar International and Primerica. Formation J. P. Morgan and the attorney Elbert H. Gary founded U.S. Steel in 1901 (incorporated on February 25) by combining Andrew Carnegie's Carnegie Steel Company with Gary's Federal Steel Company and William Henry "Judge" Moore's National Steel Company for $492 million ($13.58 billion today). It was capitalized at $1.4 billion ($38.63 billion today), making it the world's first billion-dollar corporation. At one time, U.S. Steel was the largest steel producer and largest corporation in the world. In 1907 it bought its largest competitor, the Tennessee Coal, Iron and Railroad Company, which...
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...Carnegie and the Age of Steel, I learned a lot about what steel manufacturing had to do with the Gilded Age time period in America. The film first opened by talking about how in the late 1800’s Andrew Carnegie was now the richest man in the United States. But how did he get to be that way? Well, that is what the film goes into next. New Englanders were faced with a crisis in these times, iron was too expensive, but iron was the thing that fueled the New Englanders industry. So the colony started to manufacture their own iron to try and cut costs. Many iron mills were created in the New England area, and some Americans, but many indentured servants from Europe worked in the iron mills. With America becoming a hub for producing iron, the British wanted to restrict the growth of the iron mills in the United States but ultimately failed, because by independence day, the United States now produced 1/4 of the worlds iron. Many cities emerged with the creation of the many iron mills in America, one being Pittsburg, which became iron’s capital. When Andrew Carnegie was a young boy, he was poor and worked as a telegrapher, until noticed and admired by Tom Scott, a man who was very knowledgable in the railroad and iron industry. Soon after Tom Scott discovered Carnegie, Carnegie became his assistant, and became very interested in iron and the use of it to build America’s many new railroads. However, while iron was a great industry for Carnegie, with the invention of steel in 1856, Carnegie...
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...During the life of the United States, there have lived countless men that have changed the world one event at a time. During an incredible time for trade, growth and development, the United States faced a new benchmark for success and growth within the country - this was the Second Industrial Revolution. Andrew Carnegie, John D. Rockefeller, and Alexander Graham Bell revolutionized the United States individually with their self propelled contributions; they represented the epitome of individual prosperity and national growth. Andrew Carnegie’s fortune under current inflation rates would equate to nearly 12 times as much as Bill Gates’ worth. Carnegie was born poor, and moved to the United States as a Scottish immigrant looking for a better future and life. Ultimately, not only did he find a better life, but nearly infinite success during the second revolution. For Carnegie, he founded one of the most expansive and lucrative industries in this time, and even today, a steel company. Humbly, Carnegie started work as a factory worker, however over time, he was able to climb the ranks, eventually earning enough to found the Pittsburgh Steel Company. This company alone, settled Carnegie with a substantial fortune, however given his entrepreneurial mindset, he pushed forward and was able to thrive with philanthropy. Carnegie's influence during this time really shines when he is noted for combining many smaller steel companies, and his own to form U.S. Steel. This company was responsible...
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...LARGE POWER TRANSFORMERS AND THE U.S. ELECTRIC GRID Infrastructure Security and Energy Restoration Office of Electricity Delivery and Energy Reliability U.S. Department of Energy April 2014 Update Large Power Transformers and the U.S. Electric Grid This page intentionally left blank. DOE / OE / ISER April 2014 ii Large Power Transformers and the U.S. Electric Grid FOR FURTHER INFORMATION This report was prepared by the Office of Electricity Delivery and Energy Reliability under the direction of Patricia Hoffman, Assistant Secretary, and William Bryan, Deputy Assistant Secretary. Specific questions about information in this report may be directed to Dr. Kenneth Friedman, Senior Policy Advisor (kenneth.friedman@hq.doe.gov). Tiffany Y. Choi of ICF International contributed to this report. The U.S. Department of Energy would like to acknowledge the following reviewers for their contribution to this report: ABB American Transmission Company Bartley, William H., Hartford Steam Boiler Inspection and Insurance Company, A member of the Munich Reinsurance Company North American Electrical Reliability Corporation Ontario Power Generation Scott, Daniel U.S. Department of Commerce U.S. Department of Homeland Security U.S. Federal Energy Regulatory Commission Cover photo sources: Large power transformer photo: Siemens.com High-voltage transmission lines photo: Utilities-me.com DOE / OE / ISER April 2014 iii Large Power Transformers...
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... Major Issue 1: Nucor is forfeiting market share to foreign steel producing companies who are exporting goods into the United States. In 2011 direct steel imports from foreign competitors accounted for 22% of the U.S. market despite significant unused steel making capacity. Many foreign steel producers have costs at or below that of Nucor. These low production costs allow for foreign companies to undercut the prices offered by Nucor. This in turn leads to the reduction of jobs in the steel industry in the United States. Due to differences in exchange rates and foreign companies receiving government subsidies outside steel producing companies are able to offer unusually low prices for their steel products. Until the World Trade Organization enforces regulations to limit these unfair trade practices, or the U.S. government imposes higher tariffs on imported goods Nucor will continue missing out on large portions of market share within the United States. Major Issue 2: The level of earnings that Nucor is enjoying is nowhere near the level that they had been making before the financial crisis of late 2008. They were in the red in 2009 losing roughly 293 million dollars and have since been creeping steadily back up to a mere 778 million in net earnings in 2011. This is roughly half of the earnings they were reaching from 2004-2008 as they were netting and average of 1.5 billion dollars per year. The steel industry is one that is very volatile with regards to economic conditions...
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...Conference 1 NUCOR CORPORATION 2008-2009 Thomas M. Box Pittsburg State University Pittsburg, KS 66762 Phone: 620-235-4582 Email: tbox@pittstate.edu Warren D. Miller Beckmill Research, LLC Drawer 1158 Lexington, VA 24450-1158 Phone: 540-463-6200 Email: wmiller@beckmill.com ASBE 35th: Proceedings Page -401- Association for Small Business & Entrepreneurship 35th Annual Conference 3 ABSTRACT Nucor Corporation 2008-2009 is a strategic management case appropriate for first-year MBAs or seniors in an undergraduate capstone course. The focus of this case is the strategy of the most successful steel-maker in the United States as of 2008/2009. It has a difficulty level of five. Secondary issues include Porter’s Five-Forces Framework of industry analysis and the effects of the global economic slowdown in the last quarter of 2008 and the first quarter of 2009 on Nucor’s business. The case is designed to be taught in a single 75-minute class and is expected to require two to three hours of outside preparation by students. In order to facilitate students’ understanding of the economics of accounting figures, we have rearranged the balance sheet so that “earning assets” equal “permanent funding sources.” For real wealth to be created, the average return on earning assets must equal or exceed the weighted average cost of capital demanded by permanent funding sources. Nucor has been the most successful American steel maker for more than 35 years. It has a unique company culture and...
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...------------------------------------------------------------------------------10-13 Section 5: Conclusion------------------------------------------------------------------------------------13-15 Works Cited-----------------------------------------------------------------------------------------------16 Section 1: Introduction The United States should institute a blanket reform of its international trade policies. Its current protectionist practices are both in violation of current World Trade Organization suggestions and mandates and, far from being beneficial to the American economy, for the most part serve to hurt both American and foreign consumers. There are few American markets not protected in some way by the Federal Government in the form of tariffs, quotas, or domestic subsidies. While these practices are touted as an aid to domestic manufacturing process, true economic analysis shows that most if not all protectionist measures actually serve to limit economic growth. The arguments given to justify protectionism range from the poorly-disguised corporate handout to downright racism, while the few good reasons for it such as to protect 'sunrise' or developing industries do not apply to the United States. Section 2: What is Protectionism? Protectionism, defined simply, is any form of barrier to free trade that a governing body places on a market. By this definition, any trade legislation that the government...
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...The Gilded Age ‘ The Gilded Age was a time of huge social change and economic growth in the United States. This time period brought a rapid development in urbanization, industrialization, the building of the railroads, innovations in science, and the rise of big business. New products and technologies improved middle-class quality of life for Americans. The rise of the Gilded Age in American History helped the American economy long-term to this present day. Economic development in the United Sates was made through the impact of transportation innovations. The Gilded Age brought upon positive changes in America there was a demand of manufactured goods that increased, therefore, needing an efficient way to keep up with high demand. This brought upon the construction of the first transcontinental railroad, connecting the Pacific and Atlantic lines, which would be used for centuries to come. The Pacific Railway Act passed on July 1, 1862 provided what was needed for the construction for this production. In the act it states: The question of "internal improvements" was constantly before Congress in the 19th century: Should Congress assist in improving the country’s transportation system? One such improvement was the dream of constructing a railroad that would cross the entire country. Railroading became a highly profitable business venture during this time period. The expansion of the railroads meant that goods and products could be more easily exported around the country...
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...Between 1860 and 1900, the United States went through a massive industrial boom due to the rapid increase of laborers and demand for oil, steel, cars, and other common products. Many of the big business owners developed a monopoly in their field of business, like oil or steel using vertical and horizontal integration methods to minimize production cost with increased speed while keeping prices high. Other factors that helped the industrial boom was rapid growth of the railroad system throughout the US. One of the biggest helps to the industrial boom in the US is the adoption of the vertical and horizontal integration systems. These systems are a type of monopoly where a business would buy all of the contributing factors in the making of their products or buy all of the retail sellers. As explained in “The Genesis of the United States Steel Corporation” by E. S. Meade, vertical integration is when a business would buy every part of the process in making the product. For example, steel industries would buy up all of the mines, to the steel billets and steel rails to minimize the cost of making the product. Horizontal integration is when a business would buy out all of the retail sellers so there would be no competition so they could make lower quality products and increase the price without worry of competition. Andrew Carnegie was the owner of the Carnegie Steel Company, the biggest steel company of the time, he used vertical integration to minimize his production costs. Meanwhile...
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...Conference 1 NUCOR CORPORATION 2008-2009 Thomas M. Box Pittsburg State University Pittsburg, KS 66762 Phone: 620-235-4582 Email: tbox@pittstate.edu Warren D. Miller Beckmill Research, LLC Drawer 1158 Lexington, VA 24450-1158 Phone: 540-463-6200 Email: wmiller@beckmill.com ASBE 35th: Proceedings Page -401- Association for Small Business & Entrepreneurship 35th Annual Conference 3 ABSTRACT Nucor Corporation 2008-2009 is a strategic management case appropriate for first-year MBAs or seniors in an undergraduate capstone course. The focus of this case is the strategy of the most successful steel-maker in the United States as of 2008/2009. It has a difficulty level of five. Secondary issues include Porter’s Five-Forces Framework of industry analysis and the effects of the global economic slowdown in the last quarter of 2008 and the first quarter of 2009 on Nucor’s business. The case is designed to be taught in a single 75-minute class and is expected to require two to three hours of outside preparation by students. In order to facilitate students’ understanding of the economics of accounting figures, we have rearranged the balance sheet so that “earning assets” equal “permanent funding sources.” For real wealth to be created, the average return on earning assets must equal or exceed the weighted average cost of capital demanded by permanent funding sources. Nucor has been the most successful American steel maker for more than 35 years. It has a unique company culture and...
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...WORLD STEEL IN FIGURES 2014 TABLE OF CONTENTS FOREWORD Foreword .....................................................................................3 Safety and health .........................................................................4 Life cycle thinking .........................................................................5 Key facts about steel ....................................................................6 World crude steel production, 1950 to 2013 ..................................7 Top steel-producing companies, 2013 ...........................................8 Major steel-producing countries, 2012 and 2013 ...........................9 Crude steel production by process, 2013 ....................................10 Continuously-cast steel output, 2011 to 2013 ............................. 11 Monthly crude steel production, 2010 to 2013 .............................12 Steel production and use: geographical distribution, 2003 ...........14 Steel production and use: geographical distribution, 2013 ............15 Apparent steel use, 2007 to 2013 ...............................................16 Apparent steel use per capita, 2007 to 2013 ............................... 17 Pig iron, 2012 and 2013 ..............................................................18 Direct reduced iron production, 2006 to 2013..............................19 Iron ore, 2012 .............................................................................20 World iron ore trade by...
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...Tariffs, and International Trade There is a lot to think of when we talk about the United States placing high tariffs (a tax on imported goods or exported goods in most cases, but also can be considered in cases of pricing for utilities, and transportation. However, they do play different roles in policies of trade, and economic history. Tariffs were the largest source of income on a federal level from the 1780s through the early 1920’s, which is when income tax overtook the tariffs as the largest source of income. Another thing to think of is when tariffs are used for economic policy. During this time, a tariff not only supplies income, but also is often used by businesses, certain industries, and the government to control trade between nations. So what does this do? It causes either underdeveloped, or non-competitive to become competitive on a global basis, which will bring revenue to whichever country they are a part of. Another aspect of economy is that it is part of a country’s technological or political strategy which, for example, in 2002, the United States imposed a 30% tariff on steel products through 2005, which was an attempt to allow the United States steel industry to recover, and export more in terms of steel. (Behind the Steel, 2002). Countries like China and India use tariffs against the EU and United States to rapidly build their countries into technological superpowers, but also causes an imbalance in global economics. (Borrus and Cohen, 1997). Are...
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