Suspension of Production at Pohang Plant 2 and Sale of Heavy Equipment Division at Plant 1
Proceeds from Sale to Be Reinvested to Strengthen Pohang Plant 1
Labor Union to Halt Protests and Cooperate
Hyundai Steel has reached a final agreement with the labor union regarding the suspension of production at its Pohang Plant 2 in North Gyeongsang Province and the sale of the heavy equipment division at Pohang Plant 1. The proceeds from the sale will be reinvested to strengthen the competitiveness of Pohang Plant 1, and all jobs will be fully guaranteed. In response, the union has decided to halt protests and cooperate for the development of the Pohang plant.
On August 7, Hyundai Steel announced, "Due to sluggish steel demand, we have agreed with the union to suspend production at Pohang Plant 2, which has been idle since June, and to sell the heavy equipment division within Pohang Plant 1 to an external party." The company has accepted the union's core demand for job security, and the proceeds from the sale will be used for reinvestment in the Pohang plant.
The heavy equipment division produces crawler products used in excavators and other machinery. Recently, the business has deteriorated due to a surge of low-priced Chinese products and a slump in domestic demand. As a result, Hyundai Steel identified the division as a target for restructuring and has been pursuing its sale. Potential buyers such as Daejoo and KC Group have been mentioned, but the company stated, "No specific buyer has been determined yet."
Hyundai Steel added, "Plans for reinvestment following the sale of the heavy equipment division will be established through separate discussions," and emphasized, "We will focus our efforts on enhancing the sustainability of the Pohang plant."
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