POSCO to Invest $600 Million in Thai, Indonesian Auto Sheet Mills

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--South Korea's major steel producer, POSCO (NYSE:PKX) (Seoul), is strengthening its profile in Southeast Asia's expanding auto industry with plans to invest $600 million in the construction of galvanizing plants in Thailand and Indonesia. Kim Sun-won, president of POSCO South Asia Company (Bangkok), said that each plant project would be allocated $300 million.

Rayong is the center of Thailand's automotive industry. POSCO has secured a site in the area for the plant, which will have a continuous galvanizing line (CGL) for automotive sheets, with an annual capacity of 400,000 tons.

In 2012, Thailand produced 2.45 million vehicles, which represented a growth of 68% over 2011. Domestic sales were 1.44 million vehicles, topping the South Korean market for the first time. Exports came in at 1.01 million vehicles.

The company will begin an environmental impact assessment (EIA) in April, and it plans to have the plant fully operational by the end of 2015. The main focus will be on the domestic market, with surplus margins for export.

The Indonesian integrated steel mill will have an annual capacity of 3 million tons and is scheduled for completion by the end of 2013. The annual capacity of the CGL will be 400,000 tons. Product will go to the domestic market and to the region's automotive sheet market.

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