Hyundai Steel to Sell Construction Equipment Division at Pohang Plant 1

Main Producer of Crawler Tracks Division
Construction Equipment Sales Down 65% Compared to 2021

Hyundai Steel is moving forward with the sale of its Construction Equipment Division, which primarily produces crawler tracks for excavators, located at its Pohang Plant 1.

According to the steel industry on June 2, Hyundai Steel is considering selling the Construction Equipment Division at its Pohang Plant 1 to Daeju and KC Group.

Most heavy equipment used at construction sites, such as excavators, bulldozers, and track loaders, adopts crawler track systems for mobility. Recently, the steel industry as a whole has been facing difficulties due to a combination of oversupply from China, sluggish global demand, and a domestic market downturn. In this context, Hyundai Steel, the second-largest steelmaker in Korea, appears to have decided to divest a business unit that has lost its competitiveness.

In fact, Hyundai Steel's sales volume of construction equipment has plummeted recently. Last year, the sales volume of construction equipment dropped by 65% compared to 2021. Company-wide, Hyundai Steel has implemented emergency management measures, including a 20% reduction in executive salaries and a voluntary retirement program for all employees, as part of its cost-cutting efforts.

Along with the sale, Hyundai Steel plans to support employees by reassigning them to other positions to ensure stable employment.

A Hyundai Steel representative stated, "Despite continuous efforts to maintain competitiveness, we have faced structural limitations due to a loss of competitiveness against rival companies and low-priced Chinese products. We are reviewing the sale of the construction equipment business in order to strengthen our core capabilities in the steel sector and ensure employment stability."