POSCO, Sony Seal the Deal

Sony agrees to import POSCO steel plates following Toyota Motor, as Korean steel products pass rigid tests

POSCO has succeeded in its effort to supply steel plates to Sony Inc. of Japan, which will be used in LCD TVs, making the Korean steel giant the first foreign steelmaker to supply products to Sony.
The coup follows POSCO's feat to supply automotive steel products to Toyota Motor of Japan. The steelmaker said it will begin to ship its steel plates to Sony's overseas plants in such countries as China, Malaysia, Thailand and Mexico as early as this month under the agreement announced at Sony's head office in Tokyo on April 7. The electric lead alloy steel plates that POSCO is set to ship to Sony's plants around the world are a high-quality steel product that can deflect magnetic fields generated inside of the LCD TV out of the TV set, thus preventing accidental functions in the set. POSCO is likely to ship around 20,000 tons of the steel plates to Sony plants overseas annually, about 10 percent of the Japanese electronics maker's annual requirement, the steelmaker said. POSCO expects it will be able to increase its steel plate supply to Sony to 30 percent of the company's total need after next year. Sony has been using steel plates supplied by Japanese steel makers including Nippon Steel and JFE Steel to upkeep the quality of its LCD TVs produced at its plants in various countries. But the company decided to use POSCO's steel plates following a number of tests on quality, price and service, POSCO said. POSCO went through a tough time securing the deal with Sony. In 2004, POSCO obtained Sony's alloy product quality certificates based on Sony's quality standards. POSCO formed a task force solely for work related to securing the right to supply steel plates to Sony, which began tests on POSCO's steel products from early last year, at its overseas plants in various countries.
POSCO was able to cut the time required to conclude the test from two years to just a year by responding to Sony's requests in real time. Still, it took five years altogether to secure Sony's permission and conclude the deal. POSCO began shipping steel products to Toyota Motor plants in Japan, which have been known for their thorough requirements. The steel giant has been supplying automotive steel plates to Toyota plants in Thailand and Indonesia since 2005, but it marked the first time POSCO steel plates were used in Toyota plants in Japan.
POSCO officials said the significance is that the steelmaker found a new exit out of the economic quagmire by securing a stable sales route of its products to Toyota Motor.
On March 31, POSCO celebrated its 41st anniversary at its head office in Pohang and all participants determined that the steelmaker will challenge the current economic crisis sweeping the world and turn it into an opportunity for the next stage of its continuous growth. Chairman Chung Joon-yang, in his congratulatory speech, said the entire company should have a new determination and attitude in the face of the darkness that clouds the future. The chairman called on officers and staff of the steelmaker to think about their mission with a broader mind, wider insights and speedy moves to lift the company out of the current economic mess.
The CEO said the mission they face now is to put POSCO in the forefront of "green growth" by continuously developing the steel production business so that more clean energy can be used to produce materials and services that mankind needs and, in the process, make POSCO a green enterprise.
The exploration of stages means that POSCO should endeavor to seek more opportunities in the Euro-Asian, American, and African continents amid diversified technology development and expanded exchanges, Chung said. In the meantime, Chairman Chung has been elected as chairman of the Korea Iron and Steel Association (KISA) at the association's first temporary general conference on March 30 at POSCO Center in southern Seoul.
Chairman Chung, in his acceptance speech, said he feels a heavy responsibility as he took over the helm of the KISA amid a very difficult period for the steel industry in general due to the economic crisis at home and abroad triggered by the U.S. financial debacle.
He said unity is what the steel industry needs at the moment to tide over the current tough times. All member firms and their employees should pool their strength together and fight to resolve the crisis. nw

POSCO Chairman Chung Joon-yang