Forging What Comes Next with Dave Burritt, President and CEO, U. S. Steel

Welcome to Steel Stories by US Steel. In this podcast, we go beyond the headlines, bringing you insights, ideas, and stories shaping how steel is made, used, and reimagined. Through conversations with industry leaders and innovators, we explore what it takes to keep forging the future of America. Welcome to Steel Stories by US Steel. I am your host, Ethan Epstein. Today we're joined by a guest who, for listeners of this podcast, really needs no introduction. However, I will introduce him. Dave Burritt is the president and CEO of U.S. steel, and we are thrilled and, frankly, a little bit honored that he's joined us today. Well, thank you very much for having me, Dave. It's great. Great to see you, as always. So, if memory serves, you've been on this podcast before, and I think the last time you were here, there was, like, some little deal or something you were working on. What was. What was that about? We would think of it as maybe a big deal, but that's. That's fine. Yeah, it was a. The Nippon U.S. steel. That's right. Did that get done? It concluded in a very favorable way, especially for our workers and the communities where we live and work. Glad to hear. You know, this is actually jogging my memory, and now that I think about it, I think it was a year ago, in fact, that that partnership was officially, officially finalized. So when you look back on it, I mean, there was a lot of political controversy. It was. It was a tough road at times, I would think. What really stands out to you about that? That 18 months. I think what we showed as a. As a company is that when you assemble the right people that are committed to an important outcome, you get a good result. And it wasn't an individual. It was groups of individuals that understood how important this deal really was for the workers and the communities. In addition, of course, to the stockholders, the customers, the suppliers. All these things combined, it was such a great deal that we felt confident it was going to succeed. And I think that strengthened everyone's resolve to go the distance, in spite of the fact that there were so many people, so many adversaries that made it difficult for us to move this thing forward as quickly as we would have liked. You know, there was so much rhetoric, you know, you could even say misinformation about the deal and the way it was structured. How did you, you know, as a leader, how did US Steel break through that to, for example, you know, talk to the employees to make them understand what this deal really meant for them? The thing that really helps us at US Steel is we're grounded in our steel principles or think of it as our code of conduct. S T eel safety first, trust and respect, environmental stewardship, excellence and accountability, and lawful and ethical conduct. So that's at our core. And I have to say, every time we had our deal teams meetings, I would start with why we're here and that we're the truth tellers. And I remember people telling me at the time, oh, it's so good that you're reminding us all that. And the reality was I'd get quite angry and I have a tendency to emote or obliviate about certain individuals or companies or characters that were trying to kill a great deal. But when I said that, it's always remind yourself what's important. And that I think stood the test of time. And, and as the truth tellers, when people would make up things about the deal, we could always ground our in the truth. And it carried us forward, especially when you get the right people on the bus headed in the right direction, wanting the right outcome for the company and Nippon as well as, you know, the, the communities, the workers, the stockholders, the customers and the suppliers. By the way, emoting is always welcome on the U.S. steel podcast. So if you ever let it, let it rip. You know, I think that during that period, I. You remained very committed. The U.S. steel leadership team, the Nippon Steel team, obviously remained very committ to the, to getting the deal done. But there were naysayers, right? There were people that said, this thing's not, you know, I'm sure people urged you to pull the plug. It wasn't worth it. I mean, what was it really like personally that kept you strong when in the face of all those doubts? Well, it comes back to our code. But you start with our fiduciary duties here on, on this. We had a legal obligation to get the best deal for our stockholders. That's what we had to do. And you can't have a code of conduct that doesn't respect the law. And so we knew we had to do it. Fact, let's face it, nobody was walking around thinking, oh, I hope we can sell the company. We didn't want to have that happen. But it became very evident that we were going to be attacked by adversaries in trying to kill the company and hurt our workers. So that strengthens our resolve, not only from a legal standpoint, but just an ethical standpoint that we want to do the best for our workers and our communities. And I think getting this deal done proved that out. We have a remarkable deal. We got 10.8 billion that we got to get done by the end of 2028 SPEN or committed and a total of $14 billion in total. That is, that is a remarkable amount that we have for, for a company. I mean, we talk about this a lot. It's like you feel like in some instances the dog caught the car. Now you got to get the things that you worked so hard for and you realize it. Well, it's a really good problem to have to be able to spend this money, upgrade our facilities and not just improve the facilities, but upgrade the talent. Because with these new operations and new things we're putting in place, there's going to be education and training for. And I'm just more than excited about the future as a result of this deal that got done. Yeah, there was a lot of the, the opposition centered around the fact that U.S. steel, which is this, you know, iconic American company, it's got us right in the name, would no longer really be American. They frame that as a loss for America. Right. I mean, how did you counter that? Well, we, again, we just told the truth. The reality is this ends up being a partnership. Yet we understand that Nippon is the single stockholder of U.S. steel. But you see through all that and you realize that it's being run by us people. You know, we're going to make sure that the headquarters stay in Pennsylvania. We're going to make sure that we respect the laws on trade and we're going to make sure that we do everything we can to run this business according to our code in a way that ensures the future of our company for our customers, our suppliers, our employees, the communities. I mean, it's really a beautiful thing. If I looked at the company a year ago before the deal closed and I looked at it today, what would you say would be the most noticeable differences that have occurred in this gear? Well, I think, no question about it, the talent that we're bringing in from Nippon to teach us how to make the best steel in the world, they are extraordinarily talented and they make steel that people in the United States have never made before, especially as we get into electrical steels and things like that. So I would say bringing in what they call dispatchers are actually expats that come in, you know, to help us understand what needs to be done to upgrade our facilities, upgrade our talent and create the best steel maker with world leading capabilities. It's, those are the things that make the difference and that's what attracted us to this. You know, Nippon has the Deep pockets to make these levels of investing. We'd love to make the, these investments, but the fact is we did not have the balance sheet. So, you know, it's all about capital allocation. You have so much money to spend and you have to put it in those assets that you believe will create the most value. And what they see is because they've experienced many of the issues that we've had and they've spent money to improve and they brought talent in to improve. So they've been through this before and now they're helping us succeed. So it's the technology they're bringing, the talent, they're bringing the investment. All these things are wonderful for U.S. steel. And has anything surprised you in this year or is this, this pretty much what you expected? No, what surprised me is how well the transformation is going. And I've been, I'm an old guy, so I've been through a lot of transformations and they usually don't go this smoothly. Usually what happens is they come in, they reorganize, they move a bunch of people around and create an incredible amount of uncomfortability. But what we have is this high degree of trust. And you know, Morrison, who led this whole thing from the Nippon perspective, we've become very close as a result of. You can imagine what we've been through and, and the things that he highlights and I highlight is why didn't we find ourselves sooner? Yeah, we should have found each other earlier because there's so much and they live by a code. Safety is first. All these things are so, so common. You know, they got Nippon, which means, you know, in Japan and we got US Steel in our name. So, you know, it's like there's so many things that are common and it's so important that we continue to work together, but that the transformation is better than any transformation I've ever been associated with. The collegial nature, the focus on commonality, things that work together is really fabulous. You know, it makes you wonder if that 18 month period where for example, you were working so closely with more now, I wouldn't really wish that experience on anyone, but it probably made it so we were kind of hitting the ground running on integration like we'd integrated so much already. Right? Sure. You know, there's a. I always like to refer to some stoic for you, Amor fati, you know, it's lover of fate. Whatever happens, you just say good. And that's what happened here. It's a good thing that we had this extra time to work together. This time for them to come visit all our facilities, our time to go visit their facilities, our time for us to get to know one another. I mean, that's really been good. So really, the transition started when we first met because it was such an incredible connection. So, you know, we are more fatied, this thing. And we're doing our best to turn the page because, let's face it, these adversaries, you know, it's, it's, it's hard for me to turn the page. I'm doing my best, but when people try to kill your company, it's hard to forget that. But we're in a good place and we need to move forward. And, you know, the big task is what we call the main thing. The main thing is make sure you keep the main thing. The main thing, as Stephen Covey would say, and for us, is to make sure we get this $14 billion spent on time, on budget, and by the book. And by the book means according to our duties, our fiduciary duties, to Nippon, to the Golden Share, to the federal government, to our workers, to our employees living by our code. So we're very focused on that. But it, it is a daunting task at this point. In fact, what I tell people now is like, presume all the projects are bright red and flashing, that we're in trouble, because that inspires us to work harder, work smarter, and get things done to make sure. It's. Because usually what happens with Project All Green, everything's good. And then you get to the last six months, you go, oh, I didn't know about that. Well, we're starting with the end in mind and making sure we're bringing it back to the present. And so we feel the pressure, we feel the heat. And fortunately, we had this long, long time to work together, so we understand what the differences are in our culture. And there's language differences, a whole lot of differences. But when you have common goals, you have alignment. And that's, you know, that's a key ingredient to trust. Trust is, I always think of as three things. Trust is integrity. You gotta work with people that are honest and capable. You gotta make sure the partners you're lining up with are very capable. And the third one's even harder because we know it with my spouse or my family, if we don't have goals that are congruent, it's a problem. So we make sure we got the main thing and we got the improvements we have to make. And when you keep the main thing, the main thing, you will Build the trust, the capability, the integrity, the alignment. All those things come together very nicely. And that's, and I think that's why we're doing as well as what we are so far. You know, Amor Foddy is a wonderful idea. The color me a little skeptical that you always said it was good when all those bad things were happening to us in that period. But I do get, you know, I do like to emote when things are less than good. But we do that amongst your leadership team and we understand what's real and what's not and what we'll say publicly versus we can argue, we can debate, but then you come together and you align on a common. In fact, we like to say people have an obligation to dissent and then actually come together once we've decided on the direction and then we move forward together, lock step, arms together. And that's where we are with, with Nippon, under their leadership to make us this best steel maker with world leading capabilities. Let's talk a little bit about the impact that all of this investment is going to have on the communities where U.S. steel is too. I mean here in Pittsburgh, Gary, Arkansas, Alabama, I mean all these places are really seeing an influx of investment as you've alluded to. What does that mean for the communities that surround our facilities? Oh, it's fantastic for them. And one of the reasons this got done is you just take care in Pittsburgh and in the Mon Valley region because of the mayors that were there that took the time to understand the deal. I don't think there's a single person when you first hear like Nippon's going to be buying. So they said, oh great, you know, but then once they understood it and once they start talking to people just like myself, it's like once you start realizing what the benefits are, you come together on this. And obviously when you create profitability through increased investment, that profitability, that increased investment finds its way into the community because we're going to have trades coming at each of them. So I mean there's tens of thousands of folks that will be working on our sites and spending money in our community. So it's, it's quite a market, marvelous thing for the communities where we live and work and, and also because of these investments, we're more engaged and we engaged before, but we're more engaged than ever with, with the people in the community. But when people in the community stepped up for our deal at U.S. steel wheat, not just, you know, feel like we want us or we feel an obligation to support this community Even in more strong way because they fought for what was, what was right. And you know, there's some that we had, the adversaries. The point I want to make sure is clear. The people that actually looked at this in a deep way, they understood it. In fact, you think about all the major newspapers around the world, whether it be the New York Times, the Wall Street Journal, the Washington Post, USA Today, I think the Financial Times, you know, you just start naming off all the big newspapers. Every one of those editorial boards said this is a no brainer, this should be done. This strengthens national security, economic security, job security and creates jobs. You know, how can this be a good thing? So I think everybody understood what was real. We just had a few difficult adversaries early on that made this really troublesome because they didn't either didn't take the time or they had other things they thought would work better for them, even though they didn't really have the truth. You know, thinking about that effect that the, the beneficial effect of community, of, to the communities of all this investment, you know, more jobs and everything. There is a worry on the job side though, which is going to pivot top here that AI might erode some of those job gains. You know, a lot of people in various industries, and I think steel making is one of them, are worried that AI is kind of coming to replace them. Now you're enthusiastic about AI? AI is the future. You know, it's, it's, it's not coming, it's here, it's now. And if you're not already using AI, you're probably being left behind because what we say to people is use AI and you'll make sure you have a secure future. If you ignore AI and don't want to learn AI, you will be left behind because we're not going to have anybody that's using AI AI be left behind. I hear all the time that oh, it's going to eliminate all these jobs. Well, it's going to create a lot of jobs, different jobs, better jobs, safer jobs. With our big cap expend AI is right in the heart of that because without AI you can't do something this complex. There are too many interdependencies that rely on one another. For somebody to go through a project with, you know, pages and pages and pages, thousands of pages to construct a billion dollar type project. And it's, you just can't, can't rely on the technology that we have today, call it digitization or whatever, the spreadsheet type stuff that we Use. You have to have AI point you in the right direction. Yeah, yeah. Moving forward. Just, just to think a little bit more about the Nippon Partnership. I was wondering if you found any. You know, there's a cultural difference between Japan and the U.S. how have you worked to bridge that? How are people on the ground here working to bridge that? How do, how does this really become an integrated operation? You know, let's face it, when you have language differences and many of the people, this is the first time they've worked in the United States. So we, we provide support for how them to have them get integrated. They get invited to events and there's more we can do there. People need to, you know, outside of work. You know, we don't want the Nippon people just meeting with Nippon people or the U.S. steel people just meeting with U.S. steel people. So we have these employee resource groups that create environments where they, you know, they can go to, you know, Penguins event or Steelers event or, you know, you know, a Pirates event here in, in Pennsylvania or, you know, let's, let's face. Got the same kind of thing with, at Gary Works or in Minnesota, you know, or Arkansas, you know, you pick a facility, Great Lakes now, Granite City, that it's, it's open. And of course Alabama, you just go through each one of these facilities and every one of them has programs that are engaged in the community. You know, it's clear that one of the reasons that Nippon Steel was attracted to US Steel was the kind of re industrialization that's happening in the United States. A, do you see that? And B, what role do you see steel playing in. In the re. Industrialization? Yeah, it's, it's a good point. I think the re. Industrialization, I think what they saw is an opportunity in the, in what I call the best market in the world, which is the US Market. And then also from their perspective, it's demographically, they're not having increases in population, which also constrains, you know, let's face it, if you're not increasing the population, then you're. Their GDP is not going to be increasing over time. So they were looking for other opportunities to grow. And the United States was a great opportunity to come. And when we ran the process, they started looking at the business. They saw our footprint, they saw the acumen of our commercial teams, they saw the acumen of our, our workers of what they are came with. And basically they liked it. They liked not just what was at Big river, but they also liked what was at the integrated mill. So this re Industrialization I, is perhaps something but I haven't talked with them a lot about that. But more importantly was the footprint that we had and the connections we had with customer supplier, the full value chain that attracted them to this. Because we have talented, talented workers in place. They don't have to like do a greenfield site and start pulling people together. They got leadership that knows what's going on, cascaded through the whole company and workers that know what their jobs are. What we've been missing is the investments and now that we have the investments and the technology they bring, the expertise that they bring, I mean this is, this is a great marriage for us there. There's no question about it. I'd say the, you know, our best days are clearly had. You know, we used to just say we're going to get better and we were getting better. Now we say we're getting better and bigger. I mean think about that. That growth formula is there. It's going to be a lot of work work. But the payoff at the end of all this is soon. But it'll never end. We're always going to be investing. But this big input on investment and transfer technology is unprecedented in the steel industry in the United States. That's a great segue to the last question. Thinking about those long term investments, Nippons long term horizon, 10 years from now, where do you see US steel still a decade from? Well, I, I think they'll look at us as the true leader in the usa. Let's face it, we're not the leader in the usa. You know, we got Nucor, we got Steel Dynamics. They're the ones to be, they're extraordinarily well run companies and lots of cash flow and lots of investment. They're the ones we really have to compete with. That's the future. And with these investments, I'd like to think we'd be the best steel maker in the United States with these world leading capabilities because of what we're doing here right now with the workers that we have and the work, the more workers that will grow with more job creation. Well, thanks so much Dave. Hey, thanks everybody for joining Steel Stories with President CEO Dave Burritt. And we'll see you next time on Steel Stories by US Steel. Thank you. Steel Stories is produced by US Steel. The views expressed by our guests are their own and do not necessarily reflect those of US Steel. To learn more about our people, our capabilities and where steel is headed next, visit ussteel. Com. You can find Steel stories on Apple podcasts, Spotify or wherever you listen. And be sure to subscribe so you don't miss what's ahead. Thanks for listening.