Trump Invokes ‘Golden Share’ to Block U.S. Steel Plans for Illinois Plant
Commerce secretary told U.S. Steel CEO the administration wouldn’t allow Granite City production to cease
The Trump administration blocked U.S. Steel’s plan to halt production at its Granite City, Illinois, plant.
Trump used the ‘golden share authority’ from Nippon Steel’s takeover to veto the plant’s closing.
U.S. Steel reversed its decision, agreeing to continue operations at Granite City Works, rolling steel.
The Trump administration flexed its new authority over U.S. Steel, blocking the company’s plan to shut down production at an Illinois plant this fall.
Two weeks ago, U.S. Steel notified workers in Granite City, Ill., that plant operations would cease in November. The company, owned by Tokyo-based Nippon Steel 5401 0.00%increase; green up pointing triangle, said it would continue paying the mill’s nearly 800 employees, even without them doing regular production work.
Commerce Secretary Howard Lutnick got wind of the plan and called U.S. Steel Chief Executive Dave Burritt, a person familiar with the matter said. Lutnick told Burritt the administration wouldn’t allow operations to cease, and the president would invoke his so-called golden share authority over plant operations.
The U.S. government cleared Nippon Steel’s $14.1 billion takeover of U.S. Steel in June after the company entered into a national-security agreement. Conditions of that agreement gave President Trump and future presidents the right to veto plant closings, the transfer of production out of the country and other changes in operations.
On Friday, U.S. Steel said it has reversed its plan and that Granite City Works would continue rolling steel slabs into sheet steel.
“Our goal was to maintain flexibility, and we are pleased to have found a solution to continue to slab consumption at Granite City,” the company said
The intervention shows the Trump administration’s growing influence in the private sector. Last month, Trump said the U.S. government would take a 10% stake in chip manufacturer Intel, which had received billions of dollars in grants via the 2022 Chips Act.
Nvidia and Advanced Micro Devices separately agreed to pay the Trump administration a portion of sales from artificial-intelligence chips to China.
Union leaders had opposed the Japanese company’s purchase of U.S. Steel, warning that Nippon Steel could close plants and import foreign-made steel from its other plants. Nippon Steel said it was committed to improving U.S. Steel’s plants and pledged to invest an additional $14 billion in new equipment and repairs.
The United Steelworkers union, which represents Granite City’s hourly workers, had pushed back against U.S. Steel’s plan to transfer work typically done at the mill to other company plants. They described the move as a violation of Nippon Steel’s pledge to maintain production at U.S. Steel plants.
In the national-security agreement, Nippon Steel committed to operate U.S. Steel’s existing plants through 2035, and the Granite City plant into 2027.
“They have to operate the facilities at full capacity,” said Mike Millsap, a United Steelworkers regional director. “This is exactly the thing we were afraid of with Nippon Steel.”
Lutnick, in a recent interview on CNBC, described U.S. Steel’s plan to pay employees at a plant that isn’t operating as “nonsense.”
Trump’s interest in the Granite City mill stretches to his first term, when he repeatedly cited the plant as an example of the domestic steel industry’s recovery under his administration.
After Trump imposed tariffs on foreign steel in 2018, steel prices and sales soared. U.S. Steel recalled hundreds of laid-off workers to restart the plant’s two blast furnaces, which had been idle for more than two years because of low steel prices.
The Granite City mill has been operated for more than a century. But U.S. Steel has been whittling production in recent years.
The mill has the capacity to produce about three million tons of sheet steel annually, but U.S. Steel ended steel production in Granite City in late 2023. The company largely replaced that volume by doubling the capacity of its new Big River Steel plant in northeast Arkansas, about 250 miles south of Granite City.
Currently, the mill takes steel slabs produced at other U.S. Steel mills and rolls them into sheet steel.
A deal to keep production going at Granite City has been in limbo for more than three years. U.S. Steel in 2022 agreed to sell the blast furnaces to Illinois-based SunCoke Energy, which planned to produce pig iron for U.S. Steel’s Arkansas plant. The sale hasn’t been completed, facing opposition from the steelworkers union.
A SunCoke spokeswoman said discussions between the company and U.S. Steel are ongoing.
“We need a future,” said Craig McKey, president of United Steelworkers Local 1899 at Granite City. “Whatever they give us, we’re willing to do the work.”