POSCO's EVI Strategy

Steel giant holds early vendor involvement program to expand auto steel plate sales

POSCO is trying to secure its share of the automobile steel plate market by participating in new car development projects from the early stages with automobile companies throughout the world.
The steel giant held the "2008 POSCO Global EVI Forum"on Jan. 30 for some 300 officers and staff from 300 automobile and auto parts makers from around the world, including GM, Peugeot and Toyota, at the Shilla Hotel in downtown Seoul. EVI means early vendor involvement, which will have steelmakers join in the development of new car models from the early stages in order to produce steel plates that are model-appropriate.
During the meeting, POSCO extolled its know-how for the production of steel plates for autos in a bid to strengthen its ties with auto makers around the world.
President Yoon Suk-man, in his welcoming speech, said the forum is a timely attempt for boosting mutual value between the steel industry and auto industry to promote mutual growth. He said POSCO will conduct EVI publicity campaigns around the world to boost the value of POSCO in the world steel market and expand its world market dominance by taking advantage of its SCM base network in a number of key steel market countries.
POSCO officials said officials from major foreign automakers present at the meeting expressed their interest in POSCO's growth as a major supplier of automobile steel plates and their expanded cooperation with the Korean steel giant.
In response to such expectations on the part of automakers, POSCO will expand its EVI activities further and be involved from the early stages of the development of new car models including design, simulation, parts design, application and steel product assembly technologies.
POSCO will speed up the delivery of its products through its SCM network in such key markets as Japan, China, Eastern Europe and Mexico, among others.
The steelmaker launched the EVI campaign to exploit its advantage of having the capability and capacity to produce any kind of steel plates that automakers need.
Many officials from foreign car and parts makers have high expectations that EVI will go a long way to contribute to an increase in quality and a reduction in costs, and cut the production period by supplying the best-suited steel plates.
Dr. J. Fekete, technology director at GM, said POSCO's advanced high-strength steel plate is a high-class product that can boost the safety and fuel effectiveness of cars. Fekete added that GM expects to continue to maintain cooperative ties with the Korean steelmaker. Nissan's technology manager, T. Kumamoto, also said a global car maker should be able to get a supply of high-class steel from anywhere, expressing a strong interest in POSCO's EVI program linking its SCM global network.
Technology Manager S. Kotagiri of Magna Co., an auto parts maker with plants in Europe and the United States, said he is impressed by POSCO's hot press forming technology, which is designed to expand the production of high-quality steel plates.
POSCO, at its strategy meeting in Kuala Lumpur in 2001, arrived at the decision to have its Gwanyang Steel Complex expand its facilities exclusively for the production of high-class steel plates for automobiles. The steel plant put online its Nos. 5 & 6 OGL car steel plates production facilities, along with stepped up research on car steel plates by setting up a research center at the steel complex.
A number of global steelmakers, including Arcelor-Mittal, have been holding meetings to explain their steel products in general, but POSCO is the first one to hold a meeting exclusively for automobile and auto parts makers to explain its policy to participate in the development of new car models from the early stages.
POSCO adopted the strategy to hold such meetings, knowing that automakers use the same steel plates they used from the early stages of production of a new car model until it is replaced by another model.
POSCO officials said the EVI is a sort of tailored-steel production to suit the customers'demands and a steelmaker has to be confident that it can meet any requests from its customers.
POSCO's steel plate production for autos increased more than three fold from 1.7 million tons in 2001 to 5.7 million tons now. This year, the company plans to turn out 6.2 million tons of steel plates for autos, securing 9 percent of the world's car steel plate market. nw

A scene of the 2008 POSCO Global EVI Forum held by POSCO with some 300 people from auto and auto parts makers around the world including GM, Toyota and Peugeot at Shilla Hotel Jan. 30. (right photo) POSCO Chairman and CEO Lee Ku-taek.