South Korean industrial giants POSCO and Hyundai are joining forces to invest $5.8 billion in building a new steel mill in Louisiana, aiming to strengthen their footprint in the U.S. market and meet the growing demands of the automotive sector. The project has also been highlighted by former President Donald Trump as a success story of his trade policy.
South Korean Industrial Leaders Join Forces in the U.S.
POSCO Holdings Inc., South Korea’s largest steelmaker, has signed a memorandum of understanding (MoU) with Hyundai Motor Group to jointly invest in the construction of a steel manufacturing facility in Louisiana. The $5.8 billion plant is set to begin operations by 2029, according to official announcements from the companies.
Focusing on Next-Generation Automotive Steel
According to Hyundai, the plant will have an annual production capacity of 2.7 million tons, primarily focused on producing next-generation automotive steel sheets. This strategic facility is expected to provide a reliable and stable supply of high-quality steel to Hyundai’s production bases across the United States.
Part of Hyundai’s $21 Billion U.S. Expansion Strategy
The joint steel plant is one element of Hyundai’s broader $21 billion investment plan in the U.S., which includes expanding vehicle production, integrating new technologies, and enhancing supply chain resilience across its American operations.
Trump Welcomes the Project as a Win for Trade Tariffs
This investment announcement received praise from former U.S. President Donald Trump, who called it “a clear demonstration” of the effectiveness of his tariff-driven trade policies. Trump had previously imposed tariffs on imported steel and aluminum to promote domestic manufacturing.
South Korea Seeks Tariff Relief from the U.S.
Meanwhile, senior South Korean trade officials are expected to travel to Washington this week to negotiate potential reductions or exemptions from the tariffs imposed on Korean exports. South Korea was initially hit with a 25% tariff on steel, which was later reduced to 10% for a limited period, yet key concerns about fair trade remain.
Strategic Collaboration on Battery Supply Chains
Beyond steel, the two companies are also expanding cooperation in the electric vehicle sector. Hyundai stated that the partnership will include joint efforts to secure raw materials for batteries, aligning with supply chain regulations in both the U.S. and Europe. This move is crucial in supporting Hyundai’s shift toward electric mobility.
Strengthening Global Industrial Positioning
The establishment of the steel plant not only reinforces POSCO and Hyundai’s commitment to the North American market but also enhances their strategic role in the global automotive and materials supply chain. The collaboration is seen as a long-term investment in industrial resilience and competitiveness.
