Value Collector
Have courage, and be kind.
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Some industries are never really profitable because competition is to high, take airlines for example, they have lost more money than they have made as an industry.The Chart below from Goldman Sachs suggests that 99% of Chinese Steel Producers are not profitable.
View attachment 183025
Assuming that Goldmans figures are accurate, it may not mean much as making a profit is not a high priority in Communist regimes.
Mick
But, the industry margins operate on a knife edge, the moment supply is cut a little, everyone starts making money, but then they all boost capacity and losses years kick in again.
It’s not great for the share holders in that industry, but in biology we would call it an evolutionary stable system.
Such businesses tend to evolve where no player can gain a competitive advantage, they would require players to have a government enforced monopoly or some sort of cartel to make them consistently profitable.