Allegheny Technologies Inc. (ATI) is exiting standard stainless sheet products and will streamline its production footprint and invest in enhanced capabilities to accelerate the execution of its high-value strategy, primarily in aerospace and defense. ATI will exit standard stainless sheet products by mid-year 2021. In 2019, this product line represented $445 million of revenue with margins of less than 1%. As a result of these actions, the Pittsburgh-based company expects to achieve EBITDA margins of 15% or more within the Advanced Alloys and Solutions (AA&S) segment with recovery of the commercial aerospace end market.
As it accelerates its transformation, ATI expects to cease production activities at five locations by year-end 2021. In addition, the company will consolidate its finishing operations by investing $65-85 million over three years in its Vandergrift, Pa., location. These changes are expected to enable the AA&S business to significantly improve its margin profile by reducing costs and pursuing an improved revenue mix as the aerospace market recovers.