Sierra Club Calls On Michigan To Invest in Clean Steel as Cleveland-Cliffs Idles Dearborn Plant

Announcement Comes After Hyundai's $6B Investment in Louisiana, Marking Shift to Modern Steelmaking

March 25, 2025

DETROIT, MI- Cleveland-Cliffs announced today that it will temporarily idle its aging Dearborn Workssteel plant and lay off 600 workers starting in July, just as Hyundai revealed a $6 billion investmentin a new U.S. steel mill in Louisiana that it says will create more than 1,300 jobs. This underscores a shift in the steel and automotive industries: modern, direct-reduced iron steelmaking is rising, while antiquated, dirtier, coal-based facilities are being left behind.

"Big investments like Hyundai's are the canary in the coal mine for dirty steelmaking. To stay competitive, retain union jobs and protect clean air, coal-based steelmakers around the Great Lakes need to invest in modernizing their facilities," said Hilary Lewis, Steel Director at Industrious Labs."To win the next era of steelmaking - and the jobs that come with it - those investments must be fossil-free."

Hyundai's new steel plant, unveiled at the White House, is expected to use direct reduced iron (DRI) and electric arc furnace (EAF) technology, a more modern process that avoids coal entirely and could replace methane gas with green hydrogen (H2) and renewable electricity to reduce carbon emissions to near zero. In contrast, Cleveland-Cliffs' decision to shutter its coal-fired blast furnace, basic oxygen furnace, and continuous caster in Dearborn reflects the uncertain future of traditional U.S. mills that serve the auto sector.

"Michigan must invest in upgrading to clean steel production or risk falling behind and losing critical manufacturing jobs. The planned idling in Dearborn is a worrying sign for the future of steelmaking in our state," said Elayne Coleman, Director of Sierra Club's Michigan Chapter. "Hyundai is lapping our archaic, dirty steel mills, and failure to act now and join the fossil-free future risks good-paying, clean jobs for the future of our Wayne County community."

Without strong green hydrogen standards and procurement commitments for fossil-free steel, projects like Hyundai's will still rely on polluting methane gas-missing the opportunity to realize the climate and health benefits of fossil-free steel. Methane gas is 86 times worsefor the climate than carbon dioxide, locking in pollution and making it harder for the U.S. steel and auto sectors to meet climate targets.

A recent International Council on Clean Transportation reporthighlights automakers' central role in this transition. Automakers drive demand for 60 percent of the coal-based steel used in the U.S. Still, only four major automakers have committed to buying fossil-free steel by 2030, and those pledges account for just a small share of their total steel use. That's despite the clear upside: fossil-free steel could reduce steel-related emissions by more than 95 percent, with less than a 1 percent increase in vehicle costs.

"With Hyundai gaining ground and conventional mills like Dearborn Works in retreat, Michigan and other steel-producing states must act now to upgrade to fossil-free steelmaking or risk being left behind," said Maricela Gutierrez, Senior Campaign Strategist for Industrious Labs. "Fossil-free steel is essential not only to retain and create good-paying jobs in legacy steel communities but also to build a cleaner, more competitive future rooted in healthy, thriving communities."

A recent analysisfrom Michigan-based 5 Lakes Energy advised the state to provide at least $300 million in public support to stay competitive and close the clean steel investment gap. Louisiana offered Hyundai an incentives package including a $100 million performance-based grant for infrastructure improvements.

Modeling from the Ohio River Valley Instituteshows that a green H2-DRI-EAF transition can also support long-term employment, adding six new permanent jobs for every ten existing jobs in the portion of a mill's workforce dedicated to crude iron and steel production without impacting finishing operations. A recent reportfrom RMI found that green H2-DRI-EAF steelmaking can also nearly eliminate health-harming pollution, including carbon monoxide, volatile organic compounds and sulfur dioxide. Today, coal-based steelmaking is responsible for up to an estimated 892 premature deaths annually in the United States, according to researchfrom Industrious Labs.

For more information about Dearborn Works, please see the Industrious Labs factsheeton the facility.

About the Sierra Club

The Sierra Club is America's largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.

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