Hyundai Steel Co.’s steel mill in Dangjin, about 80 kilometers south of Seoul, is seen in this file photo provided by the company. (Image courtesy of Yonhap)
SEJONG, Jan. 9 (Korea Bizwire) — Hyundai Steel, a key affiliate of Hyundai Motor Group, is reportedly exploring plans to build a large steel mill in the United States. The move comes as U.S. President-elect Donald Trump signals heightened protectionist trade policies, urging foreign companies to manufacture within the U.S. to access its market.
Potential U.S. Expansion
Industry insiders revealed on January 8 that Hyundai Steel is in talks with several U.S. states, including Georgia, where Hyundai Motor Group already operates facilities. The proposed plant would produce steel plates for automobiles, a core component for Hyundai and Kia vehicles.
If approved, the facility would be Hyundai Steel’s first overseas steel mill, potentially representing an investment of over 10 trillion won with an annual production capacity of millions of tons.
Hyundai Steel’s total crude steel production is currently around 20 million tons annually, with 5 million tons dedicated to automotive steel. Of this, approximately 4 million tons are supplied to Hyundai and Kia.
Navigating Trade Barriers
Hyundai Motor Group has significantly expanded its U.S. production capacity, operating plants in Alabama, Georgia, and the Hyundai Meta Plant in America (HMGMA). Once fully operational, these facilities will produce up to 1.2 million vehicles annually.
However, U.S. steel import quotas, established under Section 232 of the Trade Expansion Act in 2018, limit South Korean steel exports to the U.S. to 70% of their 2015-2017 average, or 2.63 million tons tariff-free annually.
Building a steel mill in the U.S. would not only stabilize Hyundai’s automotive operations but also provide a workaround for these trade restrictions, offering a long-term solution for Hyundai Steel’s constrained export volume.
Strategic and Political Considerations
Beyond operational benefits, a large-scale investment in the U.S. could strengthen Hyundai’s position in its largest overseas market while aligning with Trump’s emphasis on domestic manufacturing. Analysts view such a move as a strategic gesture to secure a favorable business environment amid anticipated trade policy shifts under the new administration.
President-elect Trump has emphasized reducing trade deficits and restoring manufacturing jobs by raising tariff barriers, signaling a shift away from subsidy-heavy policies toward incentivizing local production. Hyundai’s investment could serve as both a practical solution and a goodwill gesture to navigate this evolving landscape.
Ashley Song (ashley@koreabizwire.com)
