(Bloomberg) -- Thyssenkrupp AG unit Acciai Speciali Terni SpA could see as much as 190 million euros ($220 million) in sales disappear if the European Union doesn't take measures to protect the bloc's steel producers from increased imports in the wake of U.S. metals tariffs, according to the company.
“About 10 percent of our revenue could be wiped out without EU safeguard measures,” Chief Executive Officer Massimiliano Burelli said in an interview with Bloomberg. The Terni, Italy-based company is expected to have 2018 sales of 1.9 billion euros for the fiscal year ending in September, he said.
EU Trade Commissioner Cecilia Malmstrom said this week that the EU could limit its imports of steel from around the world to prevent the European market from being flooded by shipments diverted away from the U.S., which in March introduced a 25 percent steel tariff on national-security grounds.
“Those measures are not designed to boost our production, only to protect current sales,” Burelli said. “This is true for our company, and true for all European steelmakers.”
Safeguard Curbs
Acciai Speciali Terni, which sells steel products such as electro-welded tubes to carmakers including Volkswagen AG and Magneti Marelli SpA, was founded in 1884. Thyssenkrupp's 2018 sales forecast is 42.2 billion euros, according to analyst estimates.
The European probe into possible “safeguard” curbs on imported steel marks the defensive part of a three-pronged EU strategy for responding to the U.S. steel tariff and to a 10 percent levy on foreign aluminum that President Donald Trump also imposed in March on national-security grounds.
The EU safeguard investigation could cover 26 types of steel ranging from stainless hot-rolled and cold-rolled sheets to rebars and railway material. Together, the products account for 40 percent -- or 22 billion euros -- of the EU's annual iron and steel imports.
“We clearly cannot compete with China's prices,” Burelli said. “Without EU intervention, the European industry could face very hard times.”
--With assistance from Jonathan Stearns.
To contact the reporter on this story: Chiara Albanese in Rome at calbanese10@bloomberg.net
To contact the editors responsible for this story: Jerrold Colten at jcolten@bloomberg.net, ;Alan Crawford at acrawford6@bloomberg.net, Richard Bravo, Paul Abelsky
©2018 Bloomberg L.P.
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