State steel conglomerate is an amalgam of Austria's industrial strains
Linz, Austria — The Voest-Alpine Group, the state-owned steel conglomerate based here, is in many ways a microcosm of Austrian industry. It's nationalized, politicized, diversified -- and in the red.
``Our strategy is to concentrate on the growth of businesses outside steel,'' says Josef Fegerl, vice-chairman of Voest-Alpine and head of its steel division. Steel revenues continue to rise, but account for only 16 percent of the total.
A real growth area has been countertrade, mostly in oil and with the Eastern bloc. This sector has increased more than tenfold in the past seven years.
Voest-Alpine has also ventured into services -- plant management -- and electronics. The factory for a joint venture with Oki Electronics, a Japanese chipmaker, is being built.
Voest trimmed its labor force from 84,276 in 1974 to 70,188 in 1984. Actually, 20,000 jobs in what Mr. Fegerl calls ``our traditional areas'' were eliminated, and some 6,000 new jobs created.
Critics feel Voest must go even further in trimming jobs and is being held back by the political pressures to be expected in a nationalized concern.
Voest-Alpine is a product of a 1973 shotgun marriage, at the behest of the state, between two very different steelmakers.
Alpine, at the time the No. 2 steelmaker in Austria, was in the Erzberg (Ore Mountain) section of the province of Styria. The ancient Romans forged weapons from the low-quality but easily reducible ore found there, and the area provided steel to the Austro-Hungarian Empire. The mills, in the Alps, had lovely scenery, but their logistics left something to be desired. They are viewed as uneconomic today, especially when only a third of the ore they use is local; the rest is imported, mostly from Brazil, v ia Rotterdam, and shipped by barge and rail to the mills.
Linz, on the other hand, had no steel mills until Hitler decided he needed some more or less out-of-reach of Allied bombers. With a shorter history, the Voest works have had less obsolete plants.
One analyst has doubts about the diversification strategy. Flat steel is still profitable, he says. The company sells to such blue-chip customers at Fiat, Daimler-Benz, BMW, and Zanussi, the Italian appliancemaker. And Voest is supplying continuous caster technology to Bethlehem Steel.
Voest-Alpine has had better management than most of Austria's nationalized industries, he notes. But political control of industry continues to keep it from taking the bold steps it must to run at a profit.