Gerdau idles auto shredder

The steel company Gerdau has reportedly idled its Wilton, Iowa, auto shredding operation. According to KWQC TV, the shutdown resulted in 15 people being laid off.

According to KWQC, Gerdau, headquartered in Brazil, confirmed the equipment was closed, writing, “Gerdau confirms the idling of its Wilton, Iowa, shredder, an operation employing approximately 15 employees. The company’s decision to idle was based on market analysis, our production capabilities and identification of cost competitive alternatives to help ensure the sustainability of the Wilton steel mill, which employs approximately 250 people.

“It was not easy for the company to make this decision since it impacts employees’ lives, but it was necessary in order to ensure the long-term success of the Wilton mill. A potential restart of the shredder would be considered if market conditions improve and appear to be sustainable.”

The shredding operation in Wilton had been restarted in mid-2012 after being idle for three years.

The close of its auto shredder follows the company’s sale of its special steel production company in Spain to the investment group Clerbil SL. The sale of the operation, which focuses primarily on the automotive industry, is aligned with Gerdau's goal of focusing on its more profitable assets.

Gerdau, which will once again operate under the Sidenor brand, has three plants in Spain plus commercial offices in Germany, France, Italy and the United Kingdom. The company's installed capacity is 1 million metric tons per year, and it supplies special steels to diverse sectors of the economy, especially the automotive industry.

André B. Gerdau Johannpeter, CEO of Gerdau, says, “Faced with the global challenges of the steel industry, we are seeking to generate more market value and increase the competitiveness of our operations, keeping debt levels under control. In this context, the sale in Spain is being held so that Gerdau can focus on more profitable businesses. I would also like to thank our local team commitment to face the challenging time experienced across the world steel market.”