POSCO Establishes Automotive Steel Joint Venture with Hebei Iron and Steel in China

Contract Signed for Joint Venture of Automotive Coated Steel Sheets with China Hebei Iron & Steel Group
Chairman Choi Jung-woo: "We Will Strengthen Our Position as a Supplier in the World's Largest Automotive Steel Market, China"

[Asia Economy Reporter Hwang Yoon-joo] POSCO is promoting a joint venture with China Hebei Iron and Steel Group (Hebei Iron and Steel) for the production and sales of automotive galvanized steel sheets in China.

POSCO announced on the 25th that it will establish an automotive galvanized steel joint venture with Hebei Iron and Steel by investing 50% equity each.

Chairman Choi Jeong-woo said on the day, "Through the joint venture with Hebei Iron and Steel, POSCO plans to strengthen its position as the most competitive supplier of automotive steel sheets in China, the world's largest automotive steel market."

Hebei Iron and Steel, which produced 44 million tons of crude steel in 2020, is the second largest steelmaker in China and the third largest in the world, and is included in the Fortune Global 500 along with POSCO. POSCO and Hebei Iron and Steel plan to invest a total of $600 million, $300 million each, to build a 900,000-ton capacity galvanized steel sheet production plant in the Laoting (Laoting) Economic Development Zone, Tangshan City, Hebei Province. Construction is scheduled to begin in January next year and be completed by the end of 2023.

In addition, POSCO plans to incorporate Guangdong CGL, which is currently operating in Guangdong Province, China, with an annual capacity of 450,000 tons, as a subsidiary. Accordingly, the joint venture will have a production capacity of 1.35 million tons, and the cold-rolled coils (Full Hard) used as raw materials will be supplied equally by both companies according to their shareholding ratio.

China is the world's largest automobile manufacturer, producing 25 million units last year, accounting for 32% of global automobile production, and is expected to continue growing as the world's largest automotive steel demand market. POSCO is expected to establish a stable supply system to respond to the growing demand for automotive steel sheets in China through this cooperation with Hebei Iron and Steel.

This content was produced with the assistance of AI translation services.