Chairman Kwon Oh-joon of POSCO.

POSCO plans to boost its R&D in steel technology by expanding investments in the sector to catch up with Japanese steel makers, and at the same time stay ahead of Chinese steel makers, who have been growing fast. POSCO’s top management felt that the steel maker should have its own pool of special steel production technologies, and in order to do that, they should continue to develop high-level steel technologies to stay ahead of competition in the global steel market.

The steel maker has decided to boost its investments in the R&D sector to 2 percent of its annual sales revenue, which comes to around 300 billion won every year, which is higher than those made by its overseas rivals.

As a result of its intensive R&D activities, the steel maker holds around 8,000 intellectual property patents for steel technologies, including 6,000 at home.

With the opening of its R&D Center in Songdo, Incheon in October 2010, POSCO has been able to strengthen its solution marketing, which includes providing support for R&D activities, planning, marketing consulting, and investments packages of integrated solution to the customers.

Achievements in solution marketing have been popping up here and there since the arrival of Chairman Kwon Oh-joon. Early this year, the steel maker won the awards from GM and Toyota as the superb supplier of steel plates in 2014. POSCO also developed 100 mm thick steel plates to cope with the changes in steel plates used by shipbuilders and won a certificate from the German Shipping Association. The steel maker continued to focus on the development of new steel products to cope with the changes in demand for steel products.

The steel producer has been able to increase the sale of its special high value-added steel products and solution marketing connected sales of steel products to 13 percent and 186 percent, respectively, so that share of the high value-added steel products to 33.3 percent of total sales of steel products.

POSCO has been focusing on the expanded production of steel plates for autos as it supplies steel plates to 15 top auto makers in the world, including GM, Nissan, Honda, Ford, Fiat and Toyota, taking up some 10 percent of all steel plates for autos produced.

POSCO’s steel plate production facilities come to around 20 percent of the steel maker’s total steel production facilities, but it takes up around half of the steel maker’s total profit. The steel maker has the steel plate production facilities in China, Mexico and India, in addition to its Gwangyang Steel Complex in Gwangyang, South Jeolla Province in Korea. POSCO’s steel plant in Thailand is scheduled to be completed in 2016.

POSCO, in addition, kicked off the construction of a steel plate production plant in its Gwangyang Steel Complex in September. It has the capacity to turn out half a million tons of steel plates annually, strengthening its position as the No. 2 steel maker of steel plates in the world.

An inside view of a POSCO steel plant in Gwangyang, Korea.(Photos:POSCO)