Taking the Lead! strategy
SSAB’s strategy is to strengthen our leading positions in high-strength steels globally, in our home markets, and as a provider of value-added services.
In 2017, after two years of restructuring following the combination with Rautaruukki in 2014, SSAB entered a new development phase toward profitable growth. SSAB’s “Taking the Lead!” strategy, first introduced in 2012, continues to drive the strategic decisions and actions of the company.
In 2017, SSAB announced new ambitious growth targets for 2020. These targets will contribute to SSAB’s vision of a stronger, lighter and more sustainable world.
Leading home-market positions
The Nordic and North American home markets remain the foundation for SSAB to build further offerings. SSAB aims to strengthen our home market positions in the coming years.
Maintaining market leadership with an enhanced product mix
SSAB will maintain a Nordic market share of 40-50% by serving the region’s leading OEMs and distributors as well as smaller customers. This will be helped by growth in SSAB’s own channels, including the metal distribution company Tibnor and the steel construction company Ruukki Construction, and also in partnership with customers and external steel distributors with which the company has long-term agreements.
SSAB Europe also aims to increase the share of premium products to 40% of total shipments by 2020 (2016: 30% and 2018: 36%). This includes growing premium offerings like Automotive premium, GreenCoat®, SSAB Laser®, SSAB Boron and SSAB Form. The goal is to reduce less profitable product volumes, especially standard products outside of the Nordics.
Increased market share for plate in North America
SSAB is the market leader in heavy plate in Americas, and in recent years has been able to further strengthen our market leadership against local competitors and imports.
Moving forward, SSAB aims to maintain a market share of around 30% in the North American plate market (2018: 28%), with a growing share of premium products. SSAB is considering investments to remove bottlenecks in our production facilities to increase capacity, and to serve the growing market demand in coming years.
Global leadership in high-strength steels
SSAB is well positioned to take advantage of opportunities in high-strength steels. Thanks to leading brands, a unique product offering, profound expertise and close collaboration with customers in developing new steel applications, SSAB has long been the global leader in this segment. The ever growing need for higher productivity and more sustainable solutions is the main driver for growth. SSAB’s 2020 growth target for high-strength steels reflects the positive outlook in the segment.
SSAB Special Steels
Aiming for 1.35 million tonnes in 2020
SSAB Special Steels is aiming for 1.35 million tonnes of shipments in 2020, compared with 1.0 million tonnes in 2016 and 1.3 million tonnes in 2018. Most of this growth is the result of upgrading, i.e. creating market demand by moving customers from standard grades to high-strength grades. To achieve this, SSAB focuses on product and application development, growing stock sales capabilities, expanding sales capabilities in emerging markets, as well as continued development of our brand programs.
During 2018, a decision was taken to invest SEK 1 billion to increase annual Q&T capacity in Mobile to around 400,000 tonnes in 2021 compared with existing capacity of around 300,000 tonnes.
Automotive premium steels - aiming for 750 thousand tonnes in 2020
SSAB serves the world’s leading automotive companies with high-strength steel applications. Lightweighting, emission standards, safety standards and electrification contribute to a positive outlook for the use of high-strength steels in the automotive segment. SSAB sees the potential to continue to grow in this segment, and therefore aims for shipments of 750 thousand tonnes in 2020, compared with 442 thousand tonnes in 2016 and 562 thousand tonnes in 2018.
Leading value-added services
Value-added services represent an important area for SSAB’s long-term development, as many customers focus on their core activities and demand more services to complement the products. Value-added services act as additional components to the strategic ambitions outlined above, supporting SSAB’s activities in high-strength steel sales and in our home markets, as well as differentiate us from our competition.
The SSAB Services business unit builds the network and develops Hardox® Wearparts concepts. The Hardox® Wearparts network is comprised of 483 member companies globally (as of the end of 2018). These centers provide replacement parts and services to end customers in mining, recycling, quarrying, cement and agriculture. SSAB aims to have more than 500 companies in the network in 2020.
SSAB Services also manages the downstream service concept of SSAB Shape, which offers steel-processing services for OEMs and their subsuppliers. SSAB will continue to grow steel processing Shape services to customers, often in emerging markets where capabilities to process high-strength steels are less developed.
SSAB aims to grow our distribution services business in selected markets. Unlike many of our competitors, we operate our own global stock network and can serve the end-user market with short lead times. SSAB will grow the share of stock shipments as a way of increasing the value of steel shipments to our customers.
SSAB’s fully-owned leading Nordic steel distributor, Tibnor, will expand its presence in all Nordic countries, expand the multi-metal offering, and lead the way in digitalization of the business.
Most flexible operations
To outperform peers and achieve industry-leading profitability in the coming years, SSAB will continue to focus on efficiency, flexible operations and utilization of the global production system.
SSAB has in place a continuous improvement program with annual target-setting powered by the SSAB One management philosophy. The program delivers productivity gains every year by involving all employees in improvement activities, and secures SSAB’s leading cost position in our home markets.
SSAB has a flexible production setup, with the ability to produce high-strength steels and other products at several mills and therefore allocate production depending on availability and market situation. This also means that SSAB has the potential to be more resilient in weak business cycles.
One of the key elements of SSAB's strategy is to be a high-performing organization, which is an essential enabler for SSAB to achieve its ambitious strategic targets. SSAB strives to be the safest steel company in the world, with an objective to achieve zero accidents, work-related injuries or illnesses. An operating model built on decentralized accountability and entrepreneurship is fundamental to the success of SSAB.
We have three prioritized areas that we see as critical to be a high-performing organization:
- To be the safest steel company in the world
- Working with SSAB One and continuous improvements to enhance productivity
- Strengthening the performance culture
Superior customer experience
Part of SSAB’s strategy is to go further than anyone else to offer customers a superior customer experience – by traditional means and by embracing new digital solutions.
SSAB strives for the highest standards in “the basics” in order to maintain our position as the preferred supplier, measured through customer surveys. This includes, for instance, responsive sales processes, consistently high product quality, on time delivery reliability and information accessibility via digital channels.
To remain at the forefront, SSAB will continue to invest in technical support and joint innovation initiatives to help customers to get the best out of SSAB’s high-strength steels. Combined with leading brands and customer brand programs like “Hardox® In My Body” and “My Inner Strenx®,” SSAB can further strengthen customer partnerships.