While many of you were undoubtedly enjoying your weekend — those of us in Chicago were trying to stay warm in 5 degree weather — I stumbled across an interesting article from the New York Times on how overseas investors are scooping up US companies often at fire sale prices. This should not come as a shock to anyone. All one needs to do is head to a mall and listen to all of the foreign accents. The Brits think there is a two for one sale here on everything and many Europeans are flying to NYC for a weekend getaway and some bargain shopping.

So what does a weekend getaway in NYC have to do with metals? Well, according to the Times article, ThyssenKrupp Stainless just spent $3.7B to build a stainless facility in Calvert Alabama because “of the low cost production of the United States. But that news has been previously reported. What is interesting is the why and the when. Since imports are now so expensive, ThyssenKrupp did what any investor might do and establish a local presence. ThyssenKrupp will now be able to take advantage of NAFTA and position themselves for a larger chunk of the North American stainless market. The goal is a 5% US market share and up to 1M tons of flat rolled product according to the company’s press release on the same subject. According to an article by Recycling Today, “There are 15 prominent manufacturers of stainless steel flat products, three of which (ThyssenKrupp Stainless, the Acerinox Group and Posco) manufacture around 1.8 million metric tons.” This new investment is quite significant.

Perhaps ironically, ThyssenKrupp is pursuing this strategy in the face of sagging profits and sagging demand for stainless, according to this recent Forbes article. But no matter. It’s still a great buyer’s market and there are plenty of foreign firms sniffing around at both American acquisitions as well as greenfield opportunities.

Though some view foreign buying of US companies as a threat, we think it will be a boon to US buyers. From the buyers point of view, competition among suppliers is nearly always a good thing. This new plant will be state of the art if it is to compete in the decades ahead and not only will it increase supply, helping to keep down prices but it will also raise the quality expectations in the wider market place forcing incumbent suppliers to improve quality too.

How can buyers prepare for when ThyssenKrupp comes on stream in 2010? Well, given our 2008 stainless steel price predictions, consider locking in some longer term contracts as prices drop. And maybe, just maybe, buyers will see some better pricing for the longer term.

— Lisa Reisman

Home of such influential rockers as the White Stripes, Electric Six, the Detroit Cobras, and the Raconteurs, Detroit was also rocking and rolling with the North American International Auto Show last week. The show will remain open to the public until January 27. Not the biggest, maybe not even the most-loved auto show around, the Detroit show is still well-known as the first international auto show to begin each year. The season begins when Detroit says ready, set, and GO.

There were more than a few highlights from this year’s show, ranging from the Corvette ZR1’s debut  into high society (the only place a car like that can travel, with its $100,000 price tag!) to a country-western star unveiling the Ford F-150 and a cattle drive complete with 120 longhorns  accompanying a Dodge Ram  near Detroit’s Cobo Center. Here’s the new song for cowboys: Save a horse; ride a pickup. The green theme of the Detroit show was also pleasing to the crowd ” as were several new cars from Asian manufacturers.

Why is the Corvette ZR1 of any interest to metals fanatics? Because of the wide array of metals which are used to make this high-performance sports car so incredibly lightweight. Light weight is necessary when you intend for your car to hit more than 200 mph. First the basics: Based on the original ZR-1 (note the hyphen, which is now missing), the car is very simple in appearance ” but the car is clearly built to fit its $100,000 asking price. The supercharged V-8 engine is capable of 620 horsepower, and will make its mark as the most powerful Chevrolet in existence. According to the New York Times, the front fenders, front splitter, lower rocker moldings, roof panel, roof bow, and the hood were constructed with carbon fiber, while the chassis’ frame rails are hydroformed aluminum.  Magnesium is used to make the fixed-roof frame and steering column bracket. The Times also notes that the monstrous brakes are created with carbon-ceramic rotors, which saves 11 pounds per corner over iron rotors.

Although the environmentalists couldn’t be too fond of the cattle drive Chrysler let loose on Detroit ” after all, cows supposedly emit more air polluting gases than even cars  ” the green theme of the show inspired those looking out for nature, and shamed some of the more ecologically reckless. While muscle cars and big trucks aren’t disappearing anytime soon (and I’ll admit that I’m an avid environmentalist who secretly adores old muscle cars), the future looks green for many consumers. Although the Corvette ZR1 boasts a powerful V-8 engine, it has  been reported that interest in the V-8 engine is sputtering.  Instead, it seems that smaller engines and alternative-fuel vehicles have been promoted at the show. Hybrid cars have been growing in popularity for quite a while. But despite the interest, writer Jerry Garret asks, Where is that next generation of vehicles capable of meeting those federal mandates, lowering greenhouse gas emissions and pioneering uses of alternative forms of propulsion? They seem to exist, for the most part, still somewhere over the rainbow and in television commercials. The green-themed Detroit auto show, however, is a clear move to help people who ”  to quote Garrison Keeler  ” hate something, change something, and make it better.  Metals can play a clear role in this search for the perfect environmentally-friendly vehicle, as this blog explains. Lighter metals lead to lighter cars, which can lead to less fuel consumption. Various cars may have the limelight this month at the show, and the cattle may keep downtown Detroit busy, but lightweight metals are playing their own starring role at the North American International Auto Show.

— Amy Edwards