Thyssenkrupp's Mixed Signals: EBIT Recovery Can't Silence the Drums of Protest

Thyssenkrupp posts surprise adjusted EBIT jump to €198M, but worker protests and cheap imports underscore steel division's deep challenges as EU tightens import rules.

The German industrial heavyweight finds itself caught between two very different narratives. On one hand, a sharp improvement in operating earnings suggests the years of restructuring are finally taking hold. On the other, a mass demonstration by IG Metall through the heart of Berlin this Friday laid bare the deep-seated anxieties still gripping the company's steel division. The contrast could hardly be starker.

Tens of thousands of workers marched from the Brandenburg Gate to the Federal Ministry for Economic Affairs, demanding action on energy costs, import pressure, and the cost of decarbonisation. For investors, the protest was more than a political spectacle — it was a measure of just how far Thyssenkrupp still has to travel before its steel business stabilises. The union's list of grievances reads almost like a wish-list from the company's own boardroom.

Yet in the middle of this turbulence, the second-quarter numbers delivered a genuine surprise. Group revenue slipped to €8.4 billion, but adjusted EBIT surged to €198 million from a paltry €19 million a year earlier. The biggest contributor came from the very unit that has caused most headaches: Steel Europe. Lower raw material costs and the early fruits of a brutal personnel restructuring programme are beginning to show.

That cost-cutting drive is far from over. A restructuring tariff agreement with IG Metall, signed in December 2025, envisages the elimination or outsourcing of roughly 11,000 of the 26,000 jobs by 2030. Painful and socially contested, it is nonetheless the foundation on which the group hopes to rebuild.

Brussels steps in — but not soon enough

Thyssenkrupp's steel division has been battered from multiple directions simultaneously: soaring energy prices, a flood of cheap Asian imports, US tariffs, and the enormous investment required for green steel production. The situation at subsidiary Thyssenkrupp Electrical Steel in Isbergues, France, illustrates the severity — production will be halted entirely from June to September, affecting around 600 employees. Asian suppliers now account for more than half of the EU market, often pricing steel well below European production costs.

The European Union has finally reacted. Starting in July 2026, a new safeguard regulation will slash duty-free import quotas significantly and impose a 50% penalty tariff on any over-quota volumes — double the previous rate. A new "melt and pour" certificate will also require transparent documentation of the country where steel is first melted, aiming to curb circumvention. The move is welcome, but hardly a cure-all.

The scale of the global overcapacity problem is staggering. By 2027, the EU estimates it could reach 721 million tonnes — more than five times Europe's annual consumption. No wonder Brussels is tightening the screws.

At home, the strain is showing in the production data. German crude steel output fell to 34.1 million tonnes last year, the lowest since the 2009 financial crisis. Thyssenkrupp is the biggest face of that decline, but by no means its sole cause.

Stock: from rally to rut

After a strong run — a 52% gain from the 52-week low and a 27% increase over the past year — the stock has hit a rough patch. On Friday, it tumbled 5.35% to €10.79, well below the 52-week high of €13.24. The relative strength index of 49 signals neither overheating nor panic, placing the equity in a technical limbo that mirrors the broader uncertainty.

Earlier in the week, the shares had been trading around €11.34, giving back a little ground from recent highs. Over a 12-month horizon the stock still shows a gain of roughly 34%, but the seven-day slide of 7.54% has erased a portion of that performance.

Analysts are watching the July deadline when the EU Commission is expected to present proposals for revising the Emissions Trading System. Any weakening of the carbon border adjustment mechanism (CBAM) would be a double blow for Thyssenkrupp: it would undermine the political rationale for green steel investments while making imported steel cheaper again.

Management has left itself a wide corridor for the current financial year. The board targets adjusted EBIT of €500–900 million, while forecasting a net loss of up to €800 million. Construction of the direct reduction plant in Duisburg continues, but its long-term business case now depends heavily on the regulatory environment.

Thyssenkrupp's shares have become a seismograph for the health of German industry. The company supplies essential inputs to automotive, machinery, construction, and defence — entire value chains depend on its competitiveness. The question that echoed through Berlin and Brussels this week remains unanswered: can the industrial core of Europe's largest economy survive the convergence of climate policy, trade pressure, and high energy costs? The answer will be written not only in Duisburg, but also in the corridors of power.