Hyundai Steel considers building steel mill in US

Hyundai Steel's factory in Dangjin, South Chungcheong Province / Courtesy of Hyundai Steel

Hyundai Steel is considering opening a steel mill in the United States to manufacture automotive steel provided to Hyundai Motor and Kia, in an apparent move to help the carmakers minimize regulatory risks under the second Donald Trump administration, according to industry officials on Wednesday.

This comes in response to Trump’s protectionist policies, which encourage non-American companies to invest in the world’s largest economy for their stable business operation. Trump is threatening to impose higher tariffs on all imported goods.

Hyundai Steel is an affiliate of Hyundai Motor Group, so the two major auto brands hope to reduce any possible regulatory pressure from the incoming Trump administration with the localized parts production facility.

If Hyundai Steel proceeds with the plan, it would be the company’s first overseas mill, with an estimated investment exceeding 10 trillion won ($6.87 billion).

The move reflects the two auto brands’ growing presence in the U.S., with their combined auto sales setting a new annual high of more than 1.7 million in 2024.

However, as Trump steps up hostile rhetoric against any foreign manufacturing firms, both carmakers are raising their vigilance to ensure their profitable growth even in an era of Trump.

A general view of Hyundai Motor Manufacturing Alabama, the carmaker's first assembly and manufacturing plant in the United States. Courtesy of Hyundai Motor

Both Hyundai Steel and Hyundai Motor Group declined to confirm the plan to build the U.S. steel mill, but the scenario sounds feasible, as the U.S. is one of Korea’s largest export markets for manufacturing industry players.

“We review a plan to set up a production hub in other countries to respond to global protectionism,” Hyundai Steel CEO Seo Gang-hyun told investors during a shareholders’ meeting last year.

At that time, he refrained from specifying locations for its new manufacturing hub, but the U.S. is one of the most probable candidates due to its ever-growing global influence.

Regarding the overnight report, Hyundai Steel said, “Nothing specific has been confirmed.”

“We have left open a variety of options to secure our global competitiveness and sustainable growth, but the company has not confirmed anything for the time being,” the company said in a regulatory filing Wednesday.

However, the steelmaker did not deny the reported plan. It decided to issue updated statements upon confirming details on the issue.

The company is reportedly considering southern U.S. states, including Texas and Georgia, as potential locations for the mill.

Industry officials said the move will help the carmakers minimize possible tariff risks in the U.S.

“Trump places a priority on attracting overseas investment for the country, thereby creating more jobs,” an official from an auto industry said.

“The reported investment plan will serve as a bargaining chip for Hyundai Motor Group when it engages in talks with the authority there.”