POSCO Group, a leading South Korean steelmaker, said it will invest in Hyundai Steel’s US steel mill project as part of its strategy to address the comprehensive tariffs imposed by US President Donald Trump on steel imports.
According to a press release, POSCO signed a memorandum of understanding with Hyundai Motor Group to participate in Hyundai Steel’s US plant and enhance cooperation in the steel and rechargeable battery sectors.
POSCO President Lee Ju-tae said in the statement: “Through the partnership, POSCO will be able to find solutions for sustainable growth across its businesses, from steel to rechargeable batteries, by leveraging commercial synergies amid global trade pressures and a changing paradigm.”
Last month, Hyundai Steel unveiled plans to invest $5.8 billion to build an integrated electric arc furnace steel plant in Louisiana by 2029, with production scheduled to begin that year.
The 2.7 million-ton-per-year plant is expected to supply not only Hyundai Motor and Kia, but also other automakers in the United States, the world’s most important automotive market.
POSCO’s investment decision came after the Trump administration began imposing 25% tariffs on all steel and aluminum imports in mid-March.
POSCO previously said it was “actively considering” investing in its U.S. steel production operations, with equity participation being one of several options under review.
“We have not yet determined the size of our stake in the plant project. Discussions will begin soon to determine the investment percentage and other relevant matters,” according to a company spokesperson.
In a recent letter to employees, POSCO Chairman Chang In-hwa emphasized the importance of global expansion.
“With a sense of crisis that the company could fall behind if we don’t act quickly, we must invest in steel mills in fast-growing, high-margin regions, such as the United States and India, to achieve significant results,” he said.
POSCO expects the MOU to deepen its five-decade partnership with Hyundai Motor Group. POSCO is a major supplier of steel used in the automotive industry.
Under the initial agreement, POSCO will supply steel produced at the new Louisiana plant to customers in the United States and Mexico and will collaborate with Hyundai on developing materials for rechargeable batteries to support future mobility solutions, according to the company.
In North America, POSCO operates a steel processing center in the United States and a steel processing facility and an automotive steel plant in Mexico.
Hyundai Motor Group is expanding its partnerships with global suppliers to secure a stable supply of key rechargeable battery materials, including lithium and anode materials, for its next-generation vehicles.
The group aims to sell 3.26 million fully electric vehicles globally by 2030, more than eight times the 397,355 units it sold last year.
