The world's largest steelmaker ArcelorMittal and China's Hunan Valin Group and Hunan Valin Steel Co. have announced their decision to form an industrial and commercial automotive joint venture, called Valin ArcelorMittal Automotive Steel, which is to have an annual production capacity of 1.2 million mt of flat carbon steel, mainly for automotive applications.
Valin ArcelorMittal Automotive Steel will be located in Hunan Province next to Hunan Valin Steel Co.'s subsidiary, Lianyuan Steel, which will supply hot rolled coil to the new JV for the production of flat carbon steel, including cold rolled steel, galvannealed steel and pure zinc galvanized steel.
Hunan Valin Steel Co. will own 34 percent in the new joint venture, while ArcelorMittal and Hunan Valin Group will each have a 33 percent stake.
The establishment of this new joint venture remains subject to regulatory approval.
According to the China Association of Automobile Manufacturers, steel consumption by China's automotive sector will reach 12.55 million mt in 2008, and is expected to hit 21.76 million mt in 2015. At present, Anshan Steel, WISCO, and some other large scale mills are already involved in the production of automotive steel; however, China still relies mainly on imports for high-grade automotive steel sheet.