Foothold for East Asian Market
South Korea’s biggest steelmaker POSCO Co. has established an automotive steel plate production line with an annual output of 450,000 tons in Thailand, the largest car producing country in Southeast Asia. Thailand is an automobile production hub of Southeast Asia in which the manufacturing lines of global automakers, such as Toyota, Nissan and Ford, are clustered. This is POSCO’s first automotive steel plate plant in Southeast Asia.
POSCO held a ceremony marking the completion of its continuous galvanizing line (CGL) plant with an annual output of 450,000 tons in Amata City Industrial Complex in Rayong Province, Thailand, on August 31 (local time), attended by Chairman Kwon Oh-joon and Thailand’s Deputy Prime Minister Thanasak Patimaprakorn.
POSCO has now established its “global chain” connecting production, process, sales and technology support together in 18 years after it entered Thailand in 1998, which accounts for more than half of total car production in Southeast Asia. Based on this, the company expects that it will be able to provide Japanese automakers, which entered the Thai market, with higher quality automotive steel plate solutions. POSCO has spent US$300 million (335.4 billion won) to build the new automotive steel plate plant.
After Japanese automakers entered Thailand, Japanese steelmakers Nippon Steel & Sumitomo Metal Corporation and JFE Steel Corporation established their plants that produce 360,000 tons and 400,000 tons of automotive steel yearly in order to supply quality products. However, their combined production capacity still falls behind that of POSCO’s new production line. Although Japanese large steelmakers are already present, Thailand’s steel demand exceeds supply due to the increase in the demand of quality automotive steel plates.
Until now, POSCO has supplied its products to automakers in Thailand after sending its cold-rolled galvanized steel sheets produced in the Gwangyang plant to the process centers in the country. With the latest CGL plant, the company can send its cold-rolled steel plates to Thailand and undergo Zinc pre-treatment later. An official from POSCO said, “Since galvanized steel sheets are light in weight, strong and easy to process, they are high value products in high demand from automakers.”
The newly opened plant is located near areas in where major automakers’ production lines are swarmed and just 35 kilometers away from Laem Chabang Port, the logistics hub of Thailand.
POSCO has overseas production sites only in Mexico, China and India, which have many production lines of global automakers like Thailand. It has six domestic factories at the moment and its seventh CGL plant is under construction in Gwangyang to be completed in June next year.