At the Vanderbijlpark plant, where molten steel once flowed like blood through the arteries of SA’s industrial ambition, silence now looms heavier than the furnaces that sit cold. Once a symbol of national pride and engineering might, ArcelorMittal SA (Amsa) is today a struggling remnant of the country’s post-industrial dream.
The story of Amsa’s decline is not simply one of bad luck, nor just another victim of SA’s rolling blackouts and rising costs. It is a story of a company — and a culture — that failed to adapt, trapped in a fading legacy while the world moved on.
In the days when SA was laying down highways, stadiums and mines at a furious pace, Amsa thrived. It supplied the steel that built a nation. But like a boilermaker welding with a cold torch, Amsa has clanged along without heat, increasingly reliant on outdated technology, shaky strategy and a domestic market no longer able to absorb its output.
Today the company pays one of the highest electricity bills in the industrial sector — a bitter irony for an energy-intensive operation in a country where power is neither cheap nor reliable. Eskom’s surging tariffs have hit heavy industry hard, but Amsa’s response has been more lament than innovation.
“Other players found ways to cut or shift load, invest in renewables or restructure operations,” said a former executive. “Amsa kept hoping the fire would just come back.”
It’s not just the furnaces that are out of date. Insiders said Amsa’s management culture remained frozen in a 1980s corporate time capsule — hierarchical, cautious and slow to act.
“There’s a famous story,” recounts a union leader at the Newcastle plant, “of a foreman who refused to shut down a leaking furnace because it wasn’t in the day’s plan. That kind of rigidity — it’s everywhere.”
SA business culture is often accused of being reactive rather than proactive and Amsa exemplifies this inertia. Strategic shifts come years too late; innovation is talked about more than executed. And while the world races ahead with green steel, electric arc furnaces and scrap-metal circularity, Amsa clings to its blast furnaces like an elder holding onto a rusted ploughshare in a digital age.
The company has long lobbied for protective tariffs against cheap imports from China and India, and the government has often obliged. But as prices stayed high and quality inconsistent, even loyal local clients began to look elsewhere.
“We waited four months for a basic supply order,” said the CEO of a Gauteng-based manufacturer. “When we finally got it, it wasn’t even the spec we asked for. They act like they’re still the only game in town.”
Amsa’s defenders argue that its failure is a reflection of SA’s deeper malaise: poor infrastructure, policy uncertainty, a sluggish construction sector and an economy that hasn’t grown meaningfully in more than a decade. They’re not wrong, but the argument offers little comfort to the thousands who have lost jobs, or the contractors forced to import rebar from Egypt because the local giant can’t deliver.
In many ways, Amsa’s slow decline mirrors that of the state itself — hamstrung by legacy systems, beset by rising costs, burdened by labour challenges and uncertain of its role in a rapidly evolving world. Both are haunted by the ghost of what they once were and unsure how to reinvent themselves for what lies ahead.
Unlike the state, Amsa doesn’t have the luxury of tax revenue to prop up its inefficiencies. There is no shortage of ideas — restructuring around electric arc furnaces, focusing on high-value speciality steels, pursuing joint ventures in renewables, or even full-scale privatisation or break-up. But execution is another matter.
SA’s industrialists and policymakers face a choice: let Amsa continue to wither while hoping for market miracles, or reimagine it entirely — leaner, greener, and ready to compete on a global stage. But reimagination requires boldness, capital and cultural overhaul.
• Siphika is CEO of the Construction Management Foundation.
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