Supply chains now getting built in the US.

POSCO Int’l to build permanent magnet factory in US with Star Group

Oct 03, 2023

South Korea’s steel giant POSCO Holdings Inc. is expediting its push to expand its presence in the electric vehicle supply chain, one of seven growth drivers tapped to diversify its business portfolio beyond steel.

Its general trading and energy exploration unit POSCO International Corp. is said to be seeking to build a factory to produce permanent magnets, an essential part of an EV drive motor core, in the US jointly with Korean rare earth permanent magnet hidden champion Star Group Industrial Co., according to sources in the related industries on Tuesday.

The two parties are currently in negotiations with the state governments of Texas, Tennessee and Arizona to decide the location of their joint permanent magnet manufacturing factory with an initial production capacity of 3,000 tons a year, which would be later expanded to 5,000 tons a year, enough to power 2.5 million electric vehicles, sources said.

They are said to be investing up to 300 billion won ($147 million) to build the factory.

They are expected to supply permanent magnets from the factory to the top three US automakers -- General Motors Co., Ford Motor Co. and Stellantis NV -- and plan to secure orders from Hyundai Motor Co. and Kia Corp.'s US plants, according to sources.

POSCO International and Star Group aim to set up a joint venture for the US permanent magnet factory within this year. They are still in talks to determine each party’s stake in the JV.

Their US permanent magnet-manufacturing JV is expected to allow POSCO Holdings to foray deeper into the EV sector, one of the seven mainstay growth engines the Korean steel giant has been actively nurturing.

These industries are steel, hydrogen, rechargeable battery materials, lithium and nickel, energy, construction and food industries -- and the steel group has ventured into the EV business through the production of key EV battery materials such as lithium, cathodes and anodes, as well as waste battery recycling.

POSCO International supplies key EV component drive motor cores, which are produced by its subsidiary POSCO Mobility Solution.

https://www.kedglobal.com/electric-vehicles/newsView/ked202310030002