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Tariffs Could Reshape U.S. Steel’s Future
President Donald Trump expressed skepticism about U.S. Steel's proposed $14 billion acquisition by Japan’s Nippon Steel, stating that his tariff policy might eliminate the need for such a deal. Speaking at a Cabinet meeting on Thursday, Trump remarked, "U.S. Steel is going to do very well now because of tariffs, and I don't know why they even need a deal."
Trump’s latest comments add uncertainty to the future of the U.S. Steel-Nippon deal, which has faced political scrutiny since its announcement in December 2023. His statements come just a day after he declared he did not want to see the iconic 124-year-old company "go to Japan," causing U.S. Steel shares to drop 7%.
Political and Regulatory Challenges
In response to Trump’s remarks, U.S. Steel reaffirmed its commitment to working with the administration to "secure a significant investment." Nippon Steel has not issued a statement following Trump’s latest comments.
The deal has encountered opposition from both political parties. In January 2025, former President Joe Biden blocked the acquisition on national security grounds, arguing that U.S. Steel should remain under American ownership. The companies sued, alleging that the decision was politically motivated to gain favor with voters in Pennsylvania, where U.S. Steel is headquartered.
Upon taking office for the second time on January 20, Trump initially indicated he was open to Nippon Steel taking a minority stake in U.S. Steel but expressed reservations about a full takeover. His administration’s recent actions had previously suggested a more favorable stance toward the acquisition, raising hopes for its approval.
Implications for U.S. Steel and the Industry
Trump emphasized that he is open to Nippon Steel acting as an investor rather than a full owner of U.S. Steel. "Somebody else may want it," he stated, suggesting that other potential buyers could emerge.
The uncertainty surrounding the deal underscores broader concerns about foreign investments in critical American industries and the role of tariffs in shaping the domestic steel market. If tariffs provide sufficient protection for U.S. Steel to thrive independently, as Trump suggests, the necessity of the Nippon deal could be further diminished.
With the political landscape shifting and regulatory scrutiny intensifying, the fate of U.S. Steel’s proposed acquisition remains in question. Whether the company moves forward with Nippon Steel or seeks alternative partnerships will likely depend on ongoing negotiations with the Trump administration and broader industry dynamics.
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