Abstract: Did the 1970s Lead to Convergence or Divergence? Usinor vs. Pechiney: A Cross-Examination of Renewal in the Steel and Aluminium Industries
If today Arcelor appears to be a successful company, leading the world steel market, Pechiney followed a more difficult path, concluding with its recent merger with the Canadian Alcan. The two French companies apparently faced similar problems during the 1970s: a brutal decrease in demand, the need to renew production capacities, the end of the previous paternalistic human resource policy, a turn to more innovative production processes. Despite differences in the market rules and structures between the two industries, or in the economic and social importance of each in France, a quick glance would confirm the proximity of steel and aluminium industrial and management models. Are we witnessing an evolution toward total industrial similarity? In fact, the situation is more subtle. What explains Usinor's success in being a major force in Arcelor, whereas Pechiney became a small part of giant Alcan? At the end of the 1960s, while Usinor engaged in a large mass-consumption market with low or average quality products, Pechiney produced high-quality goods for a relatively small number of aluminium users. Aluminium was gaining new customers and appeared to be THE modern material, whereas steel was seen as a common product. But in the following decades, Pechiney left aside its focus on its core competency in aluminium, while Usinor remained focused on the continuous mill technology and flat product market that had been the choice of the company's creators.