POSCO is considering investing in Hyundai Steel’s planned $5.8 billion steel mill in Louisiana as South Korea’s top steelmakers seek to navigate the 25% US tariffs imposed by the Trump administration.
The potential partnership marks the first collaboration between South Korea’s longtime steel rivals in an overseas venture. Hyundai Steel announced plans last month to build an electric arc furnace-based integrated facility in Louisiana, scheduled to begin operations in 2029. The 2.7-million-ton annual capacity plant would supply both Hyundai Motor and Kia’s US operations.
Hyundai Motor Group previously unveiled a broader $21 billion US investment strategy in response to Trump’s tariff policies. The steel project requires 8.5 trillion won (approximately $5.8 billion), with Hyundai planning to secure half from Hyundai Steel and external investors.
While POSCO acknowledged it’s “considering various strategic options regarding its investment in the United States,” the company stated nothing has been decided. Industry sources indicate POSCO is negotiating for production shares in exchange for its investment.
The collaboration could extend beyond tariff mitigation into joint research on hydrogen reduction steelmaking. For POSCO, with 6.7 trillion won ($4.6 billion) in cash reserves, this represents a strategic opportunity after previous failed attempts to enter the US market. Meanwhile, Hyundai Steel faces growing financial pressure with dwindling cash reserves, down to 1.3 trillion won ($887 million) last year.
The venture aims to establish what executives have dubbed a “Team Korea” approach, enabling both companies to supply major automotive clients including General Motors and Ford without tariff penalties.
