SEOUL, South Korea (AP) — Posco, South Korea's largest steelmaker, said Tuesday it will invest $250 million to set up an automotive steel plate plant in Mexico to supply customers there and in the U.S.
The new plant, slated to begin operations in 2009, is expected to have an annual capacity of 400,000 tons of two kinds of steel plate, and will be built in Altamira, an industrial port city in the northeastern state of Tamaulipas, according to a statement by Posco.
Posco is planning to sign a memorandum of understanding on Wednesday with the state government of Tamaulipas and the city of Altamira. The Mexican government has agreed to provide various tax benefits and subsidies for employee training costs, Posco said.
The Mexican plant will help Posco to meet their goals of overseas expansion and location closer to supply points.
Last month, Posco announced that it is contemplating building a steel plant in Vietnam, less than a year after it announced a 12-million-ton a year integrated steel plant in India, a project that will involve a total investment of $1.2 billion.
Among Posco's major clients are global automakers such as Japan's Honda Motor Co., Nissan Motor Co. and Germany's Volkswagen AG, as well as South Korea's Hyundai Motor Co.