NEW YORK ArcelorMittal Tubular Products Shelby LLC is investing $30 million to increase drawn-over-mandrel (DOM) output to meet high demand for the products.
"ArcelorMittal Shelby has been operating at near to full capacity for years and numerous customers have petitioned Shelby to increase its volume offering to the market," the Shelby, Ohio-based company said July 1. "Increased volumes from this expansion will allow the facility to debottleneck operations and more fully utilize existing up-stream tube-making capacities."
"The Shelby facility is viewed as very profitable and successful in making that (DOM) product," said Mindy McLaughlin, manager of foreign direct investment for JobsOhio, a private, nonprofit corporation that drives job creation as well as new capital investment in Ohio and was instrumental in bringing the project to Shelby.
Mexico was another possible location for the expansion, but ArcelorMittal settled on Ohio due to the skilled work force and local government incentives.
"The Shelby facility really had an opportunity to expand, but there was a sense within the parent company that it could have happened in other places besides here, so the company was interested in what we could do (to support an expansion)," McLaughlin said.
The expansion, which will create 45 jobs once fully operational, is slated to begin in the third quarter and take about 18 months to complete.
A spokeswoman for parent company ArcelorMittal USA LLC, Chicago, did not return a request for comment on how much the expansion would increase capacity.
"This investment will allow us to return to our historic DOM market share and continue to grow in a profitable market niche," Edward Vore, chief executive officer of ArcelorMittals North American tubular products division, said in a statement. "It will allow us to maintain our service performance and give us additional operational flexibility."
Shelby makes about 250,000 tons of welded and seamless precision tube annually in a variety of grades for the fluid power, automotive, construction equipment, farm machinery, oil and gas tooling and service center markets.
"The seamless tube industry was really founded in Shelby in 1890 and that facility has been in the community ever since," McLaughlin said. "(ArcelorMittal) chose Ohio (for the expansion) because of the work force talent, because of our people and the skill level and the tradition that they have."