In a project that will be widely watched in the global steel industry, Severstal, the large Russian steelmaker, is taking a majority stake in an $880m venture in the US to make steel sheet for automotive bodies.

Such a large investment in the US by a Russian industrial company is highly unusual. The project will also put the spotlight on 20-year-old German technology for making steel from scrap metal that has never delivered steel to the high quality required for the exposed parts of vehicles.