POSCO Inter secures production base for motor cores in China... Advances as eco-friendly car parts supplier

China POSCO-CORE participates in new share capital increase... Becomes largest shareholder

[Asia Economy Reporter Yoo Je-hoon] POSCO International is securing a production base for electric vehicle's "heart," the drive motor core, in China, and is set to make a full-scale leap as an eco-friendly vehicle parts company.

POSCO International announced on the 27th that it held a board meeting on the 26th and decided to participate in the paid-in capital increase of POSCO-CORE, a drive motor core production corporation located in Suzhou, Jiangsu Province, China. POSCO-CORE, in which POSCO is the major shareholder, will issue new shares, which will be acquired by POSCO International and its 100% subsidiary POSCO SPS.

With this paid-in capital increase participation, POSCO International will become the largest shareholder holding 72% of POSCO-CORE shares, including POSCO SPS's stake. POSCO International (41 billion KRW) and POSCO SPS (17.6 billion KRW) plan to invest a total of 58.6 billion KRW to expand and relocate the factory site and increase facilities.

Through this investment, POSCO International plans to utilize POSCO-CORE as a base corporation in China and expand the annual production volume of drive motor cores in China from about 30,000 units last year to 900,000 units by 2025. POSCO-CORE has already secured orders for 540,000 units out of the 900,000 unit target.

POSCO International also aims to establish a sales expansion base in other regions such as Europe and North America, building a total sales system of 4 million units by 2025, including 2 million units domestically, 900,000 units in China, 650,000 units in North America, and 450,000 units in Europe. A POSCO International official said, "The sales volume of drive motor cores in the first half reached about 500,000 units, already achieving approximately 72% of last year's sales volume of 690,000 units," adding, "The drive motor core business is rapidly growing and becoming a new growth engine for the company."

Meanwhile, as the global eco-friendly vehicle market rapidly expands, POSCO International is actively targeting the eco-friendly drive motor core market as a new growth engine. According to market research firm IHS Markit, the global eco-friendly vehicle market size is expected to grow at an average annual rate of 15%, reaching 38.9 million units by 2030.