South Korean steelmaker Posco is working with Chinese steel producer HBIS Group Co. to produce and sell automotive galvanized steel sheets, the company said Friday.
Through an online signing ceremony, the two companies inked an agreement to establish an equally invested joint company, Posco said. Posco Chief Executive Officer Choi Jeong-woo and Kim Hag-dong, the head of steel business unit, attended the event.
“From our collaboration with HBIS Group we plan to reinforce our position as the most competent automotive steel sheet supplier in China, where it has the world’s biggest market for automotive steel sheets,” Choi said during the signing ceremony.
HBIS Group is China’s second-largest, and the world’s third-biggest, steel producer, and produced 44 million tons of crude steel in 2020, according to Posco. The Chinese company is listed on Fortune’s Global 500.
Posco and HBIS Group said they will invest a total of $600 million -- $300 million each -- to build a galvanized steel sheet production plant with a producing capacity of 900,000 tons in Tangshan, Hebei Province.
The two companies will start construction on the production facility in January 2022, and it is expected to be completed by the end of 2023, Posco added.
The Korean steelmaker said it also plans to have Guangdong CGL (Continuous Galvanizing Line), which it operates in Guangdong, China, become incorporated into their joint company with HBIS Group. This will add an annual production of 450,000 tons of steel products, increasing the joint company’s annual production volume to 1.35 million tons, the company said.
By Jo He-rim (firstname.lastname@example.org