Detroit-area service center has grown into a huge and complex player in the automotive supply chain.
Valentino Simone’s entry into the world of service center operations is not a lot different than many of his peers.
What he and Target Steel have done since then, however, is decidedly uncommon.
Simone, the founder and president of Target Steel, had been working for another service center company in the Detroit area when he suddenly parted ways in 1988. A colleague suggested he should consider opening his own facility, quite the challenge for the cash-strapped Simone.
But the colleague believed in him, offering some financial backing, while Simone put everything he had on following his entrepreneurial dream. Within seven months, Simone bought out his initial partner and Target Steel was on its way.
“I started as a shear operator in 1979. My career took me through all aspects of the processing business from running a lab, sales, purchasing and operations. I take great pride in knowing the ins and outs of all aspects of the business because I have worked in every area,” says Simone, who remains just as active in the day-to-day operation of Target as he was 35 years earlier.
Target began with one shear and one high-lo inside a 4,000-square-foot building in metro Detroit. After buying out his partner, he moved the business into a 6,000-square-foot building and added another shear and another high-lo. That ambitiousness would remain the path the company followed in the years to come.
As Val Simone was building the business from the ground up, he tapped the family to expedite the process. He invited Michael Simone, then a college student, to join him in the business. It was not initially part of the younger brother’s plans.
“Growing up the son of a first-generation immigrant who worked for McLouth Steel, I witnessed firsthand the volatility and challenges that plagued the steel industry. As I pursued my degree in plastics engineering, I never envisioned myself being involved in a similar line of work,” Mike Simone recalls.
But he relented, joining Val in the summer at the company’s initial plant in St. Clair Shores, then commuting between school and the facility when summer ended. It didn’t take long for him, like his brother before, to get hooked by the industry.
“I realized pretty quickly through firsthand exposure to the intricacies of the business and the dedication, expertise and passion of the people working in it, that I was going to make a career of it,” recalls Mike Simone, who serves as the company’s vice president. “The complexities of what we do, combined with our industry’s resilience to adapt, despite the challenges we face, really fuels my desire to the growth and development of the metals business.”
And that growth has been tremendous. Target Steel has become one of North America’s largest service center companies, ranking 30th on the most recent Metal Center News’ Top 50 with 2021 revenues of $633 million. It has also grown in scope.
Though processing flat steel remains the heart of the operation, the company is now processing some nonferrous material as well. More meaningful is Target’s expansion into more complex processing, the better to serve the automotive customers that remain the major end market for its products.
The growth has truly accelerated in the last few years, with several expansions and equipment upgrades.
“This has expanded not only our capabilities, but also our geographic footprint,” says Val Simone.
Today, Target operates seven facilities in three states, Michigan, Illinois and Indiana. Its portfolio includes Detroit-based Torch Steel Processing, Torch Steel Sales and, perhaps its most notable development, the creation of Target Metal Blanking.
Formed in 2020, the company was founded to fill a demand for a cutting-edge service and quality-oriented metals supplier to automotive OEMs as well as for Tier I and II suppliers to the automotive industry. The operation hopes to provide “one-stop shopping” for all metals needs for the automakers, which include the neighboring Ford Motor Company Assembly plant in Flat Rock, where Target headquarters’ facility now sits.
Target Metal Blanking provides slit coil and sheets in any configuration. Its metal blanking capabilities have been expanded to include cut-to-length blanks, configured blanks, trapezoid and parallelogram blanks as well as chevron blanks in both exposed and unexposed surface conditions.
TMB has truly taken off since its launch just three years earlier. In 2021, Target ventured outside metro Detroit for the first time, acquiring two facilities from SET Enterprises. In Sauk Village, Ill., the company acquired a Tier 1 automotive blanking operation that carried six blanking lines, plus leveling and stacking capabilities and warehousing services.
The other half of the purchase was even further outside Target’s traditional wheelhouse. The Indiana location, which housed equipment for slitting and blanking of Class A and non-Class A surface metal coils and blanks, was not in the heavy populated metro areas of Detroit or the new facility outside Chicago, but tucked away in the small, rural Southeastern Indiana town of North Vernon.
“We didn’t know anything about the area. We didn’t know if we could make this happen,” says Matt Simone, who works in business development for Target. “Just like that, we filled it up in a month and a half. Now you go there and there’s nowhere to put coils.”
TMB expanded further just last year. The company purchased a 300,000-square foot facility in New Boston, Mich., which formerly housed Michigan Steel Processing. The assets purchased included three blanking presses with beds up to 108 inches by 208 inches, two slitting lines with the capacity to process coils up to 76-inch wide, plus aluminum and exposed application processing capabilities.
Altogether, the company is up to 16 blanking lines, making it one of the largest blanking operations in the country. That position will serve them well in the years ahead, Matt Simone says.
The coming tsunami of new electric vehicle models will test the existing automotive supply chains. In the past, the expectation for 80,000- or 100,000-model runs made parts making investments more affordable and logical. That’s no longer the case, as new model programs will be looking at much smaller runs.
“When you add a bunch of vehicle platforms and they’re small, they still need stuff. The laser blanking lines are perfectly set up for ‘hey, we need 10,000 pieces for a body side’ instead of going out and paying $400,000 to $500,000 for a die,” Matt Simone says.
“We’re prepared quite substantially for the EV revolution.”
Now that the company has spread its wings beyond the Motor City, further expansion is definitely in the plans.
Target already maintains relationships with several domestic automakers outside the traditional Big 3, so it makes sense they will continue to grow to serve them beyond the Midwest.
“We recognize the changing automotive landscape. We continue to grow our business with automotive partners in the South, so we are actively looking for a location there,” says Val Simone, who was honored earlier this year by the Association of Steel Distributors as the Steel Executive of the Year, the longest-running honor in the carbon business.
Matt Simone says one possibility for Southern expansion would be to follow the lead of some of its service center peers. “We would love to partner up with a mill, getting close to a mill down south,” he says.
In addition to the desire to grow geographically, the company would like to move beyond its roots on the end-user side. “We also see an opportunity to offer more value-added work outside the automotive industry to continue to diversify our portfolio,” Val Simone says.
His brother concurs. “Our trajectory involves venturing beyond the automotive industry and exploring opportunities in other sectors. We’re also actively exploring value-add acquisition opportunities to extend our service beyond flat-rolled products and encompass all metals,” Mike Simone adds.
These plans may take a little while, as the recent splurge is the most ambitious in the company’s history, and it can take time to incorporate all of these new operations, and processes, into the organization.
Though Val and Mike are separated by 12 years, the near generation gap has hardly been an impediment to a solid partnership. “My working relationship with my brother extends beyond mere colleagues; we share a deep bond that has greatly influenced our professional dynamics. Not only did Val play a pivotal role in my childhood, but he also mentored my career in the metals industry,” Mike Simone says.
Matt Simone says the pair of leaders complement each other well. “My uncle [Val] has always been really good at buying and getting good deals from the mills. My dad has a knack for sales and customer relationships.”
On top of that, he says, they continue to set the tenor for the rest of the organization. “Those two guys are the first people here and the last to leave. It’s been like that for I don’t know how long,” Matt Simone says.
As Matt’s presence indicates, the family’s participation in the business has expanded beyond the Brothers Simone. His brother Mikey works in purchasing, while Val’s daughter Christina owns Torch Steel Sales and son Valentino, Jr. is the company’s toll processing manager.
“Target is truly a family business; my kids and my nephews are integral to the business growth,” Val Simone says, though noting the feeling extends beyond blood. “I treat all my employees like family and that bond is crucial to our growth.”[Caption:]
Years of growth have made Target Steel an integral part of the automotive supply chain.
(All photos courtesy Target Steel)