Cleveland-Cliffs Inc. (CLF): Business Model Canvas [Dec-2025 Updated]

You're looking to cut through the noise and see exactly how a major industrial player like Cleveland-Cliffs Inc. actually makes its money, especially after a year where they posted a consolidated revenue of $4.7 billion in Q3 2025. Honestly, understanding their business model is about grasping their unique position: they are North America's top flat-rolled steel producer, built on a mine-to-metal structure that gives them serious supply chain security. We've broken down their entire strategy-from their key partnerships with Automotive OEMs, which drive 30% of their steelmaking revenue, to their cost structure which targets a $50 per net ton unit reduction-into the nine essential blocks of the Business Model Canvas below. Dive in to see the precise mechanics behind their operations and where the real value lies.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that keep Cleveland-Cliffs Inc. moving product and securing its future market share. These aren't just vendor lists; these are strategic alliances that define operational stability and growth potential as of late 2025.

Major global steel manufacturer (MOU for US market access)

The most significant recent development here is the transformative Memorandum of Understanding (MOU) executed on September 17, 2025, with POSCO, Korea's largest steelmaker. This partnership is designed to facilitate the relocation of foreign industrial clients' production into the U.S. market. Management has made advancing this MOU its top priority, effectively deprioritizing other large asset sales processes for the near term. This strategic alignment is expected to be highly accretive to the business model.

Automotive Original Equipment Manufacturers (OEMs) for multi-year contracts

Cleveland-Cliffs Inc. has locked in its position as a primary supplier to the U.S. auto sector through new multi-year agreements. These contracts with major automotive OEMs secure higher sales volumes and favorable pricing that extends through 2027/2028. The third quarter of 2025 marked the company's best auto steel shipment quarter since the first quarter of 2024, signaling a strong rebound in this key segment. The company boasts nine galvanizing plants dedicated to automotive-grade steels, with five specialized for exposed parts, readying for full capacity utilization in 2026.

Here's a quick look at the automotive segment's contribution based on the latest reported figures:

Labor unions (United Steelworkers) for workforce stability

Workforce stability is anchored by long-standing relationships with the United Steelworkers (USW). The primary, four-year labor agreement ratified in late 2022 covers approximately 12,000 union members across 13 operating locations. That agreement included a commitment from Cleveland-Cliffs Inc. to invest US$4 billion in its USW facilities over the contract term to improve production and create sustainable jobs. Separately, a new 3-year labor agreement was ratified in September 2023 for the Northshore Mining operations, covering about 430 USW-represented employees.

The stability provided by these agreements allows Cleveland-Cliffs Inc. to focus on operational execution, as evidenced by the following workforce and investment commitments:

• 12,000 USW members covered by the main agreement.
• $4 billion capital investment commitment in USW facilities over the contract period.
• 430 USW-represented employees at Northshore Mining under a separate 3-year deal.
• The company employs approximately 27,000 people across its U.S. and Canadian operations.

Logistics and freight partners for raw material and finished goods transport

Moving raw materials like iron ore pellets and shipping finished steel products relies on a network of logistics partners. While specific partner names aren't detailed in recent filings, the scale of operations is clear from shipment volumes. In the third quarter of 2025, Cleveland-Cliffs Inc. shipped 4.0 million net tons of steel. The focus on cost control is evident in the operational efficiencies achieved, with unit costs expected to be down $50/ton year-over-year for the full 2025 fiscal year. The company also completed footprint optimization, idling six facilities between March and May 2025, which is expected to yield annual savings of over $300 million.

Finance: draft 13-week cash view by Friday.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Key Activities

You're looking at the core engine of Cleveland-Cliffs Inc. as of late 2025, focusing on what the company actually does day-to-day to generate revenue and manage its footprint. It's a mix of heavy industry, strategic asset management, and a pivot toward critical minerals.

Integrated steel production (BOF and EAF)

Cleveland-Cliffs Inc. runs a vertically integrated operation, which means it controls much of the process from the ground up. The company operates eight blast furnaces and five EAFs (Electric Arc Furnaces) across its facilities. This setup gives the company an annual raw steel production capacity of approximately 23 million net tons. For the third quarter of 2025, steel product sales volumes totaled 4.0 million net tons. The mix of products sold in that quarter shows the focus on higher-value materials:

The revenue stream from steelmaking in Q3 2025, which totaled $4.6 billion, shows where the sales effort is concentrated. The automotive sector remains a primary target, securing $1.4 billion (30%) of that revenue.

Iron ore mining and pelletizing in the Great Lakes region

A foundational activity is securing the raw material. Cleveland-Cliffs Inc. manages and operates five active iron ore mines located in Michigan and Minnesota, which are key to the Great Lakes region footprint. These mines produce various grades of iron ore pellets, including standard, fluxed, and Direct Reduced (DR) grade pellets. The Northshore Mining operation, for example, produces DR-grade pellet feedstock for the company's Direct Reduced Iron Plant in Toledo, Ohio. Most of these pellets move via rail to loading ports on Lake Superior for shipment to North American steelmakers. The company's strategy involves leveraging these assets to support its own steelmaking and supply external customers.

Footprint optimization and idling of underperforming assets

Managing the asset base is a critical, though often costly, activity. In 2025, this involved significant restructuring. The company recorded $323 million in non-recurring charges in the second quarter of 2025 alone, directly tied to these optimization initiatives. This included the partial idling of the Dearborn, Michigan plant in March 2025, which resulted in laying off 1,200 workers. Furthermore, the idling of the No. 6 Blast Furnace temporarily removed an estimated 1.5 million tons of annual capacity from the market, with plans to bring it back when pricing recovers. The company has announced the idling of multiple steel plants and iron ore mines across Pennsylvania, Illinois, Michigan, and Minnesota, citing weak demand and financial losses. The Empire Mine in Michigan is noted as being indefinitely idled. Management updated its full-year 2025 guidance, lowering expected Capital Expenditures to approximately $525 million and SG&A to about $550 million, partly due to these actions.

Key financial impacts from optimization activities:

• Q2 2025 GAAP Net Loss of $470 million, inclusive of $323 million in charges.
• Targeted steel unit cost reduction of approximately $50 per net ton compared to 2024.
• Halted plans for a transformer plant in Weirton, West Virginia, which was a proposed $200 million investment.

Sales and distribution of flat-rolled and specialty steel products

Cleveland-Cliffs Inc. is the largest flat-rolled steel producer in North America. A major activity is securing and fulfilling contracts, particularly with the automotive sector. The company secured new long-term supply agreements with all major original-equipment manufacturers during the third quarter of 2025. For Q2 2025, the company achieved record steel shipments of 4.3 million net tons, generating revenues of $4.9 billion. By Q3 2025, shipments settled at 4.0 million net tons with revenues at $4.7 billion. The company is also the sole domestic producer of grain-oriented electrical steel (GOES), with its new transformer plant in Weirton, West Virginia, scheduled to be operational by the fourth quarter of 2025, utilizing its own carbon and stainless steel.

Exploration and development of rare earth mineral deposits

A newer, strategic activity involves diversifying into critical minerals. Cleveland-Cliffs Inc. is actively investigating the potential for rare-earth element (REE) mineralization at two sites within its existing upstream mining footprint-one in Michigan and one in Minnesota. Geological surveys at these two locations have shown key indicators of REE mineralization. This move aligns with national efforts to secure domestic supply chains for critical materials, and the company views it as both an opportunity and an obligation. The company's total active and proposed projects tracked by Industrial Info Resources is more than $2.3 billion, with over $1.4 billion attributed to steel manufacturing projects, indicating the REE exploration is a smaller, though strategically important, component of current capital deployment.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Key Resources

You're looking at the core assets that power Cleveland-Cliffs Inc., the foundation of their entire operation as a leading North American flat-rolled steel producer. These aren't just line items on a balance sheet; they are the physical and intellectual capital that drive their value proposition, especially in the automotive sector.

The most immediate measure of financial strength is liquidity. As of the close of the third quarter on September 30, 2025, Cleveland-Cliffs Inc. maintained $3.1 billion in total liquidity. This robust cash position helps them navigate market volatility and fund strategic initiatives, like the ongoing focus on cost discipline.

The company's operational backbone is its vertically integrated asset base. Cleveland-Cliffs Inc. controls the process from the ground up, which is a massive competitive advantage in controlling quality and supply chain risk. This integration spans from mining raw materials through to final product delivery.

Here's a look at the scale of their physical assets, which are central to their resource base:

• Largest flat-rolled steel producer in North America.
• Largest supplier of automotive-grade steel in the U.S.
• Operates five iron ore mines across Minnesota and Michigan.
• Owns two blast furnaces and two primary steel-producing facilities.
• Only U.S. producer of electrical steels essential for the grid.

A critical component of their value delivery to the automotive segment is their specialized finishing capacity. Cleveland-Cliffs Inc. possesses nine galvanizing plants dedicated to automotive-grade steel, ensuring they meet the exacting standards for body panels and structures in modern vehicles.

The resource base extends beyond traditional steel inputs. Cleveland-Cliffs Inc. is actively developing its domestic iron ore reserves with rare earth mineralization potential, announcing plans to enter the rare earth mining business following discoveries in Michigan and Minnesota. This positions them for future alignment with national strategies for critical mineral independence.

To manage this complex, integrated system, the company relies on its leadership. The experienced management team, led by Chairman, President and CEO Lourenco Goncalves, demonstrates a clear focus on external factors and internal efficiency. Their key priorities translate directly into resource allocation:

Furthermore, the management team is executing on strategic contract decisions, such as not renewing an unprofitable slab contract, which was projected to boost annual Adjusted EBITDA by $125 million per quarter based on current market dynamics following the December 2025 expiration.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Value Propositions

You're looking at the core reasons why customers choose Cleveland-Cliffs Inc. (CLF) over the competition, grounded in their operational structure and the current trade environment as of late 2025.

Supply chain security via full vertical integration from mine to finished product

Cleveland-Cliffs Inc. operates as a leading North America-based steel producer with a model that spans the entire chain: mining iron ore, producing pellets, direct reduced iron, processing scrap, primary steelmaking, and downstream finishing activities. This full vertical integration is a key differentiator, giving the company control over material quality and production timelines. This structure provides a raw material advantage, as the company does not rely on imported pig iron, which faces increased tariffs.

The operational footprint supports industrial supply chains, including automotive manufacturing.

High-quality, specialized steel for the demanding automotive sector

Cleveland-Cliffs Inc. maintains a heavy focus on value-added sheet products, specifically targeting the automotive industry. This focus on quality and specialized steel is a core value proposition. The automotive sector represents a significant, high-margin customer base demanding precision and reliability.

The direct sales to the automotive market were substantial in recent quarters:

• Direct sales to the automotive market accounted for $1.4 billion of steelmaking revenues in Q3 2025.
• This represented 30% of total steelmaking revenues in Q3 2025.
• For the second quarter of 2025, direct sales to the automotive market accounted for 26% of steelmaking revenues.

The product mix in Q2 2025 showed that hot-rolled products made up 40% of shipments, with coated products at 27%.

Domestic production benefiting from US trade tariffs (Section 232)

The expanded Section 232 tariffs, which hiked the import duty from 25% to 50% on steel and aluminum in June 2025, directly support the domestic industry. CEO Lourenco Goncalves views this as a critical step to safeguard national security and domestic jobs. The tariffs have played a significant role in supporting the domestic steel industry.

The market impact includes:

The company is positioned to benefit as the US steel import share is expected to decline significantly by 2029.

Multi-year, fixed-price contracts offering price stability to OEMs

Cleveland-Cliffs Inc. has secured strategic, long-term supply agreements with several major US automakers, including General Motors. These are fixed-price contracts covering industry-standard sheet steel for up to three years. This duration is unusually long, shifting from the company's previous standard of one-year increments.

These agreements serve as a hedge for both parties against inflationary pressures. The contracts lock in favorable pricing through 2027 or 2028, securing higher sales volumes for Cleveland-Cliffs Inc..

Cost-competitive steel due to $50 per net ton unit cost reduction target

The company is laser-focused on cost-cutting, maintaining its full-year 2025 steel unit cost reduction target at $50 per net ton compared to 2024. This target remains firmly on track.

Cost performance highlights include:

• Q2 2025 saw a unit cost decrease of $15 per net ton versus Q1 2025.
• The company expected a further cost reduction of $20 per ton from Q2 to Q3 2025.
• Footprint optimization initiatives, including idling underperforming assets, are expected to generate annual savings exceeding $300 million.

Achieving this cost reduction pace, combined with healthy hot-rolled coil pricing, is expected to support growing Adjusted EBITDA generation.

Finance: review the impact of the expiring third-party slab contract (approx. 1.5 million net tons annually) set for December 2025 on Q1 2026 cost structure by next Tuesday.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Customer Relationships

You're looking at how Cleveland-Cliffs Inc. manages its key customer interactions in late 2025. It's a mix, honestly, shifting from purely transactional to deeply embedded partnerships, especially with the auto sector.

Dedicated account management for major automotive OEMs

For the automotive original equipment manufacturers (OEMs), the relationship is defintely moving toward high-touch, dedicated management. This is driven by the need for specialized, high-quality steel products. Cleveland-Cliffs Inc. has nine galvanizing plants dedicated to automotive-grade steels, and five of those are specialized just for exposed parts. This level of specialization requires close, continuous collaboration.

Long-term, fixed-price contractual relationships for stability

The stability you're seeing in the automotive segment comes from locking in terms for longer durations. Where previous automotive contracts were typically signed in one-year increments, Cleveland-Cliffs Inc. has recently inked agreements with multiple US automakers, including General Motors Co., for up to three years. This acts as a hedge for both parties against potential inflation driven by the current trade environment.

Transactional relationships with steel distributors and converters

A significant portion of the business still relies on volume movement through intermediaries. These relationships are more transactional, focused on efficient supply chain execution rather than deep product co-development. You can see the scale of this segment clearly in the third-quarter 2025 results.

Direct sales model for large infrastructure and manufacturing clients

The direct sales channel to large infrastructure and manufacturing clients is a core component, often dealing in high-volume, standard or semi-finished products where logistics and price are key drivers. This segment, along with distributors, makes up the majority of non-automotive revenue. For the third quarter of 2025, sales to this market were $1.3 billion, matching the distributor segment's contribution.

The total steel product sales volume for the third quarter of 2025 was 4.0 million net tons.

• Automotive direct sales accounted for 30% of steelmaking revenue in Q3 2025.
• The company reported total Q3 2025 consolidated revenues of $4.7 billion.
• The end of the slab supply contract to ArcelorMittal is expected in early December 2025, which will impact the 'Steel Producers' relationship into 2026.

Finance: draft 13-week cash view by Friday.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Channels

You're looking at how Cleveland-Cliffs Inc. gets its specialized steel products into the hands of its customers as of late 2025. The channel strategy is heavily weighted toward direct relationships with major end-users, especially in the auto sector, which is a key focus area for the company.

The direct sales approach is clearly the most significant revenue driver, particularly for the high-value automotive segment. For the third quarter of 2025, direct sales to the automotive market accounted for $1.4 billion of the $4.6 billion in steelmaking revenues, representing 30% of that revenue stream. This focus is reinforced by the fact that automotive-grade steel made up 30% of the total sales volume mix in Q3 2025, an improvement from 26% in Q2 2025. The infrastructure and manufacturing market is also a major direct channel, bringing in $1.3 billion, or 29%, of the Q3 2025 steelmaking revenue.

Here's the quick math on how the revenue broke down across the primary customer channels for Q3 2025:

The network of steel distributors and service centers acts as a crucial secondary outlet, capturing $1.3 billion, or 28%, of the steelmaking revenue in the third quarter of 2025. This channel helps manage volume fluctuations and reach smaller or geographically diverse customers.

Logistics is the backbone that connects production to these diverse customers. Cleveland-Cliffs Inc. relies on a mix of transport methods to move its materials and finished goods. Cleveland Works, for instance, is situated with excellent access to both Great Lakes shipping via the Port of Cleveland and robust highway and railroad transport infrastructure. The company also manages its own logistics assets, such as the wholly owned 47-mile rail line supporting the Northshore operation in Minnesota. Overall, the company supports its operations with a workforce of approximately 30,000 employees across the U.S. and Canada.

Direct supply is heavily managed through specialized finishing assets. Cleveland-Cliffs Inc. anchors its automotive supply chain with nine galvanizing plants dedicated to automotive-grade steels. Of those, five plants are specifically specialized to handle exposed parts, which require the highest quality finishes. As a concrete example of capacity within this channel, the Columbus, Ohio, hot-dip galvanizing facility alone has an annual coating capacity of 450,000 tons serving both Automotive and distribution markets.

• Direct sales team targets Automotive and Infrastructure end-users.
• Multi-year agreements secured with major automotive OEMs through 2027/2028.
• Network of steel distributors and service centers handles 28% of Q3 2025 steelmaking revenue.
• Logistics utilize company-owned rail (e.g., 47-mile line) and access to Great Lakes vessel routes.
• Supply chain includes nine automotive-focused galvanizing plants.
• Five of the galvanizing plants specialize in exposed automotive parts.

Finance: draft 13-week cash view by Friday.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Customer Segments

You're looking at the core buyers for Cleveland-Cliffs Inc.'s steel products as of late 2025. Honestly, this segment breakdown tells you where the money is coming from right now, based on their Q3 2025 steelmaking revenue of $4.6 billion.

The customer base is clearly diversified, but there's a definite focus on high-value, domestic manufacturing.

Here's the quick math on how those steelmaking revenues broke down for the third quarter of 2025:

The Automotive OEMs segment is the single largest piece of the pie, bringing in $1.4 billion, which is 30% of the total steelmaking revenue for Q3 2025. Cleveland-Cliffs Inc. has been locking in multi-year supply arrangements with major automotive original equipment manufacturers (OEMs), especially for automotive-grade steel made in the USA.

The next two segments are nearly tied. You have Infrastructure and Manufacturing end-users contributing $1.3 billion, making up 29% of that revenue stream. Right behind them, Steel Distributors and Converters accounted for another $1.3 billion, or 28%.

What this estimate hides is the strategic importance of the automotive segment, which has five galvanizing plants dedicated to exposed parts.

The smallest reported segment is Other Steel Producers, which accounted for $591 million, or 13% of the steelmaking revenue in Q3 2025. This segment includes sales to other steel producers, such as the slab supply contract with ArcelorMittal that was set to end in early December 2025, which management expected to accelerate trends into 2026.

You can see the concentration in these core markets:

• Automotive OEMs: The primary focus, representing 30%.
• Infrastructure and Manufacturing: A strong second at 29%.
• Distributors and Converters: Nearly equal to infrastructure at 28%.
• The top three segments combined account for 87% of the Q3 2025 steelmaking revenue.

Finance: draft 13-week cash view by Friday.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Cost Structure

You're looking at the cost side of Cleveland-Cliffs Inc.'s operations as of late 2025. The structure is heavily weighted toward capital intensity, which means big, fixed costs that don't change much with daily production volume. This is typical for a major integrated steel producer.

High fixed costs from property, plant, and equipment (PP&E) are the bedrock of the cost structure. These assets-the blast furnaces, mines, and rolling mills-require massive upfront investment, leading to significant non-cash charges that must be covered regardless of market demand.

The non-cash impact of these assets is substantial. The full-year 2025 guidance for Depreciation, depletion, and amortization is set at approximately $1.2 billion. This figure was actually increased from a prior estimate of $1.1 billion, primarily due to accelerated depreciation related to the company's footprint optimization, which involved idling certain underperforming facilities. This accelerated charge is a direct reflection of the ongoing effort to streamline the asset base.

The major variable costs revolve around inputs. Raw material costs-specifically iron ore, scrap, and energy-are critical. Cleveland-Cliffs Inc. maintains a structural advantage here because it is vertically integrated, using its own American iron ore, coal, and natural gas as feedstock, avoiding reliance on imported pig iron facing tariffs. The company is aggressively targeting efficiency gains in these areas, projecting steel unit cost reductions of approximately $50 per net ton for the full year 2025 compared to 2024.

Here is a summary of the key projected 2025 expenses and capital outlays based on the latest guidance:

The drive for cost discipline is evident in the updated spending plans. The company is actively managing its overhead and investment levels. The expected Selling, General, and Administrative (SG&A) expenses for 2025 are guided to be approximately $550 million, a reduction from earlier estimates, showing success in reducing fixed overhead.

Furthermore, the company has tightened its belt on future investment. The latest 2025 guidance for Capital expenditures (CapEx) has been lowered to approximately $525 million, down from the previous $600 million projection. This reduction signals a shift toward prioritizing operational efficiency and debt reduction over major new asset expansion in the near term.

The cost structure is also impacted by specific contractual and benefit obligations:

• The expiration of an unprofitable third-party steel slab contract, representing about 1.5 million net tons annually, is expected in December 2025, offering a future opportunity to shift sales mix.
• Cash payments for Pension and Other Post-Employment Benefits (OPEB) are maintained at approximately $150 million for 2025.
• The company is working through excess pellet inventory built up in 2024, which is helping to release working capital, effectively lowering immediate cash costs for raw materials.

The focus is clearly on extracting value from the existing asset base while minimizing discretionary spending. It's a tightrope walk, balancing high depreciation with the need to cut cash costs.

Cleveland-Cliffs Inc. (CLF) - Canvas Business Model: Revenue Streams

You're looking at the core ways Cleveland-Cliffs Inc. brings in cash as of late 2025. The numbers from the third quarter, ending September 30, 2025, give us a clear snapshot of where the money is coming from right now.

Total consolidated revenue for Cleveland-Cliffs Inc. in Q3 2025 hit $4.7 billion. This revenue base is supported by steel shipments totaling 4.0 million net tons for that same quarter. The company is definitely leaning into its core strength, which is supplying the automotive sector.

The steelmaking revenue, which accounted for $4.6 billion of the total, breaks down across key customer segments like this:

The revenue from sales of flat-rolled steel is the largest component, driven heavily by the automotive segment. The revenue from multi-year fixed-price contracts with automotive customers is a key stabilizer, as executives noted winning new and growing supply arrangements with all major automotive OEMs. This focus is strategic, especially with the slab supply contract to ArcelorMittal set to end in early December.

When you look at the product mix by volume for those 4.0 million net tons shipped in Q3 2025, you see the emphasis on finished steel products:

• Hot-rolled: 37%
• Coated: 29%
• Cold-rolled: 15%
• Plate: 6%
• Stainless and Electrical: 4%
• Other (including slabs and other steel products): 9%

The sales of iron ore pellets and slabs are represented within the upstream and the 'other' volume category. Specifically, slabs are grouped into the 9% 'other' volume category, which also includes other miscellaneous steel products. The sales of specialty steel, which includes plate, stainless, and electrical, make up 10% of the total shipment volume (6% plate + 4% stainless and electrical).