TAISUKE NOMURA Managing Director, Nippon Steel India Pvt. Ltd. Speech Title : Steel Technology / The Benefits of Joint Ventureship

Transcription

1 TAISUKE NOMURA Managing Director, Nippon Steel India Pvt. Ltd. Speech Title : Steel Technology / The Benefits of Joint Ventureship May 2012

2 Steel Technology : The Benefits of Joint Ventureship 3 rd May 2012 Nippon Steel India Pvt. Ltd. 2

3 Outline of Nippon Steel Corporation Organization Domestic Steel Works and Main Products Shipment - Sector Based Breakdown Overseas Offices 3

4 Organization for Consolidated Management The Nippon Steel Group 6 segments 344 subsidiaries 50,000 employees Total assets 5,000 billion yen, Net Sales 4,100 billion yen Nippon Steel Corporation Number of Subsidiary companies Contribution to Consolidated Net Sales Consolidated Corporate functions Steelmaking business Nippon Steel Engineering Co. <Engineering and Construction business> % 6 % Top Management Nippon Steel City Produce, Inc. <Urban development business> 11 2% Nippon Steel Chemical Co., Ltd. <Chemical business> 17 5% Research& Development Nippon Steel Materials Co. <New materials business> NS Solutions Co. <System solution business> % 4% 4

5 Domestic Steel Works and Main Products Nisshin steel 4 Kobe steel 7 <Domestic crude steel production> Electric-furnace Steel makers 22 Sumitomo Metal 12 Yawata 2010CY million tons Hot-rolled sheets, Cold-rolled sheets, Tin plates Galvanized sheets, Electrical steel sheets, Spiral pipe and tubes, Rail & Shapes Nippon Steel non-consolidated 29 Blast-furnace steelmakers 78 JFE Steel 26 Hikari (NSSC) Stainless Electric resistance-welded pipe and tubes, Hot-extrusion pipe and tubes NSSC Nippon Steel and Sumikin stainless steel Oita Heavy plates, Hot-rolled sheets NSC s Domestic Production Capability 40 million tons consolidated base Non-Consolidated 35 NSC Group 3 Alliance 2 Hirohata Sakai Nagoya 5 Muroran Blast furnace (Hokkai iron & coke) Special steel bars, Wire rods Hot-rolled sheets, Cold-rolled sheets, Galvanized sheets, Electric tinplate, Electrical steel sheets Shapes, H-beams Sheet piles Tokyo Pipe Heavy plates, Hot-rolled sheets, Cold-rolled sheets, tin plates Galvanized sheets, Electric resistance-welded pipe and tubes Kimitsu Kamaishi Wire rods Heavy plates, Hot-rolled sheets, Cold-rolled sheets, Galvanized sheets, Color coated sheets, Spiral pipe and tubes, UOpipe, Electric resistance-welded pipe and tubes, Wire rods, Shapes, H-beams Research & Development Engineering Center

6 Shipment Sector Based Breakdown (Non-consolidated basis) Steel Shipments Breakdown : Domestic approx. 60%, Export approx. 40% (FY10-Value base) Nippon Steel Domestic Shipments Breakdown by User (FY10) Nippon Steel Shipments to Asian Markets Breakdown by User ( FY10) Construction-related 22% Automotive 34% Construction-related, Others 22% Automotive 34% Other manufacturing 11% Cargo, Container 4% Home appliances 6% Industrial equipment 7% Shipbuilding 17% Precision Equipment 6% 6 Energy 9% Container 11% China 2.9 million tons Shipbuilding 8% Home appliances 13%

7 Overseas Offices April, 2011 Nippon Steel India Pvt. Ltd. Established Mexico City CHICAGO NEW YORK DUSSELDORF BEIJING SHANGHAI DELHI BANGKOK SINGAPORE TOKYO GUANZHOU BELO HORIZONTE SAO PAULO JAKARTA SYDNEY 7

8 NSC s Global Network Global Alliance Network Global Production Sites & Network - Automobile Sector - Non-automobile Sector Business Integration (Merger with Sumitomo Metal) 8

9 Global Alliance Network Cooperation in technology, Cross-licensing in Auto steel sheets Arcelor Mittal POSCO 5% % Blast Furnace Partnership NSC Voting rights (%) TATA Nippon Steel USIMINAS 29.2% Sumitomo Metal 9.4% Kobe Steel 3.4% Nisshin Steel 10% Others 35% NSC 1.3% Shareholders Mix NSC 29.2% Inc. indirect investment NSC 27.8% (Merger with NSC) Shareholders with shareholders agreement 64% 9

10 Global Production Sites & Network [1/2] (Automobile Sector) I/N Tek CRC 1.3m ArcelorMittal Tata Steel CAPL JV CRC 600,000 t Bao Steel BNA CRC 90,000 t CGL 145,000 t 49 SUS CRC 1m NSGT NSC 100 SNP 63 Electric resistance welded pipe 60, I/N Kote CGL 450,000 EGL 360,000 Tenigal NSC s Investment CGL 400,000 USIMINAS UNIGAL Ternium CGL 400,000 SUS: Siam United Steel SNP: Siam Nippon Steel Pipe NSGT: Nippon Steel Galvanizing Thailand CGL 950,000 JV with Nippon Steel (% of capital investment) Technological alliance NSC is strengthening the global activities by promoting overseas sites and alliance 10

11 Global Production Sites & Network [2/2] (Non-automobile Sector / Southeast Asia Area ) China PATIN (25%) (Tinplate) Thailand Siam Tinplate (STP) (23%) (Tinplate) Nippon Steel Bar & CH Wire (42%) (Bar & CH wire) India Nippon Steel Pipe India(75%) (Pipe) Vietnam POSCO Vietnam (15%) (Cold rolled) PEB STEEL (12%) (Flat products for construction) Nippon Steel Pipe Vietnam (51%) (Pipe) Malaysia Nippon EGalv Steel (50%) (Electric galvanizing YKGI (10%) (Hot dip galvanizing and precoat) Indonesia PT Indonesia Nippon Steel Pipe (70%) (Pipe) LATINUSA (35%) (Tinplate) ( %) NSC s Investment (Including Affiliates) 11

12 Business Integration Nippon Steel Crude Steel Production (FY2010) About 35 million MT April, 2012: Merger Agreement Sumitomo Metal Crude Steel Production (FY2010) About 13million MT June, 2012: Annual Ordinary Shareholder s meeting October 1, 2012: Business Integration Nippon Steel & Sumitomo Metal Corporation Nippon Steel & Sumitomo Metal Crude Steel Production About 48 million MT 12 As February 3, 2011 Mr.Muneoka, President of NSC (left) Mr. Tomono, President of SMI(right)

13 NSC & Tata Steel Joint Venture Context Outline of Joint Venture Outline of CAPL *CAPL: Continuous Annealing and Processing Line Annealing Process Merits of CAPL Strengths of Joint Venture 13

14 Growth of Indian Automotive Market Production of Passenger cars 10thousand cars UVs/MPVs include OTHERS RENAULT NISSAN HONDA TOYOTA FORD GM TATA HYUNDAI MARUTI SUZUKI CY 03CY 04CY 05CY 06CY 07CY 08CY 09CY 10CY 15CY 14

15 High Strength Steels Environment Safety High Strength Reduction of Weight Collision Safety Performance Steels Fuel-Consumption Regulation: 2020 Japanese standards 20.3 km/l (now16.3) Exhaust gas regulation: 2020 European standards 95g/km (equivalent to 24 km/l) Reduction of Weight Collision-safe regulation: High collision safety performance High Body Strength 15

16 High Strength Steels Consumption Expected Increase of Usage of High Strength Steels. (Estimation of A company) 16 % Mild Steels % % 2004 High Strengths Steels 59 % 2014 Estimate 16

17 Outline of Joint Venture [1/2] 1. Business Contents Production and Sales of cold-rolled steel sheet for automobile manufacturers in India 2. Investment Ratio (Total Investment: about billion INR) Tata Steel 51% NSC 49% 3. Employees Both Tata Steel and NSC will deploy their employees to JV s managerial positions. NSC is planning to deploy approx. ten managerial level staffs to JV from 2012 onwards, in the areas of Technology, Quality Control, and Sales Division. 17

18 Outline of Joint Venture [2/2] 4. Site Jamshedpur in the state of Jharkhand (inside existing Jamshedpur Works of Tata Steel) NORTH MARUTI-SUZUKI, TATA, HONDA CAPL JV Works, Jamshedpur 5. Project Schedule o January 2010 Memorandum of Understanding o January 2011 Joint Venture Agreement Signed o In FY 2014 Commercial Production Start WEST TATA, MAHINDRA, RENAULT, SKODA, VOLKSWOGEN, MERCEDES-BENZ, GENERAL MOTORS, FIAT SOUTH TOYOTA, NISSAN, MITSUBISHI, HYUNDAI, BMW, RENAULT, FORD India map showing Major Customer Location 18

19 Outline of CAPL CAPL: Continuous Annealing and Processing Line 1. Capacity 600 thousand ton/year 2. Applicable Types of Steel Mild Steel (including IF Steel and Skin Panel) High Tensile Strength Steel up to 590MPa 3. Product Limits Thickness Width : mm : mm 19

20 Annealing Process [1/3] Box Annealing Furnace Conventional annealing process for recovering mechanical properties of cold rolled coil. The process needs 3 steps below and about 10 days lead time. All steel makers in India possess only this type of annealing process. Electro Cleaning Box Annealing Skin Pass Mill 20

21 Annealing Process [2/3] Continuous Annealing and Process Line (CAPL) Process for recovering the mechanical properties by annealing the cold rolled coil. Single line is used for the process and the coil is processed within about half an hour. Electric Cleaning Annealing Furnace Skin Pass Mill 21

22 Annealing Process [3/3] Continuous Annealing and Processing Line (CAPL) 22

23 Merits of CAPL [1/3] 1. Improvement of Ability to Manufacture High Tensile Steel (a) It enables manufacturing of high-formability high tensile steel. High temperature dual phase zone heating + Rapid cooling process can be realized, enabling high-formability high tensile steel. (e.g. 590MPa DP steel) (b) It enhances welding capabilities. Strength can be optimized by temperature control. The steel with lower alloy content, compared to the BAF process, enables high-performance weldability. 23

24 Merits of CAPL [2/3] 2. Quality Stabilization of Skin Panel (a) It improves quality of appearance. Surface defects such as sticking and scratch marks, characteristic of the BAF, be avoided Sheets with excellent appearance for skin panels be produced. 3. Improvement of Basic Quality (a) It uniforms mechanical properties. Uniform heat treatment be done by continuous feed of strips Guarantee of uniformity of mechanical properties. (b) It enhances flatness of shape. Sheets be heated in a strip condition with appropriate tensile force Ensuring of stability of shape. 24

25 Merits of CAPL [3/3] 4. Reduction of Lead Time It reduces lead time because of short processing time. Reduction of inventories Quick delivery response Process Process Time Image [days] BAF process BAF SPM RCL CAPL process CAPL RCL Reduction image 25

26 Strengths of Joint Venture [1/2] Use of strong resources from both Tata Steel and NSC. A. Substrate Tata Steel has: o integrated steel mill with high raw material security. o taken up expansion plan for Cold Rolled facility. o space within Jamshedpur Works for the JV. on-time substrate delivery with minimum stocks and transportation. NSC will : o provide Technical Cooperation for upper stream process. o supply some portion of substrate until Tata Steel can supply all types of substrate required for the process. improve efficiency of substrate production. 26

27 Strengths of Joint Venture [2/2] B. Production Technology NSC will provide CAPL facility and its operation technology to JV including the following contents. Quality improvement of IF steel for skin panels Technology for manufacturing MPa high tensile steel C. Product Delivery Tata Steel will provide product delivery infrastructure to JV including depot (stockyard) facilities in major cities. D. Regional and Labor Related Issue Tata Steel maintains good relationship with its employees, the regional government, and the local communities. 27

28 Q) Will NSC & Tata Steel Joint Venture reduce India s need to import high-tech steel products? A) Yes, it will. 28

29 Thank you 29