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U.S. Steel to halt Texas production of some pipes

PITTSBURGH — A unit of United States Steel Corp. said Monday it will stop making certain steel pipes used in the automotive and mining industries to focus on its main sheet and tubular steel products.

U.S. Steel Tubular Products Inc. will close production lines in Lone Star, Texas, that make the pipes, used by auto makers, mine operators, fluid power component manufacturers and steel distributors. The shutdown will result in about 50 job cuts and a pretax charge of $25 million in the fourth quarter of 2008. The company did not specify when production would stop.

The pipes, known as drawn-over-mandrel, accounted for less than 3 percent of tubular steel shipped by U.S. Steel last year. That translated into about 50,000 tons.

The plan to exit those pipe markets follows a tough period for the mining industry, which stumbled in late 2008 as housing, automobile and other manufacturers that use metals cut back amid a global recession. Sales of autos, meanwhile, have plummeted.

On Monday, all the major automakers reported U.S. sales declines of more than 30 percent for December as buyers continued to avoid showrooms due to the dismal economy.

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