lyash01/iStock via Getty Images
The Alliance for Automotive Innovation has urged the Biden administration to resist Cleveland-Cliffs’ attempt to acquire US Steel, citing potential negative consequences on competition within the industry. According to Reuters, a merger between these entities could lead to anti-competitive pricing practices for vehicles.
Expressing concerns, the group’s CEO John Bozzella highlighted that such a deal could result in a situation where a significant portion, estimated between 65% and 90%, of the steel utilized in vehicles would be controlled by a single company.
The Alliance, which includes major players such as General Motors, Toyota, Hyundia, and Volkswagen, emphasized the need for the administration to explore alternative solutions if apprehensions regarding the Nippon Steel deal exist. They stressed that consolidating domestic steel production under one entity must not be considered as a viable option.
Moreover, a potential merger between Cleveland-Cliffs (CLF) and US Steel (X) would not only dominate a substantial portion of the steel market but also control all the domestic electrical steel necessary for electric vehicle motors and EV production, totaling a significant 100% share.
