Hyosung Group Chairman Cho Hyun-joon unveils his group’s investment plan in the carbon textile segment at a ceremony to strike a contract on investing in the Jeonju carbon textile plant on Aug. 20. (Photos: Hyosung Group)

Hyosung Group announced Aug. 20 it will invest 1 trillion won ($828 million) into its carbon fiber factory in Jeonju, North Jeolla Province, to boost the facility’s production capacity more than ten-fold to become the third-largest producer of the material in the world by 2028.

Chairman Cho Hyun-joon said the group will work hard to realize its experience to lead the Spandex global market in the carbon fiber production, too.

He said the investment will be used to expand the Jeonju facility’s production capacity by 12 times from the current 2,000 tons to 24,000 tons by 2028. While the factory, operated by Hyosung’s advanced materials producing arm Hyosung Advanced Materials, currently operates only one production line, the group plans to operate 10 by 2028.

President Moon Jae-in promised strong government support in fostering the local carbon fiber industry while attending a ceremony held Aug. 20 to commemorate Hyosung’s investment at the facility in Jeonju. Moon’s visit comes as carbon fiber is expected to be one of the products that will be subject to Japanese export restrictions following Korea being excluded from the neighboring country’s so-called white list from Aug. 28.

Carbon fiber is one of the key materials necessary for the hydrogen economy strongly promoted by the Moon administration.

The material, which is one-fourth the weight of steel but 10 times stronger, is used in making hydrogen tanks for hydrogen fuel-cell vehicles. Currently, it has annual output of 2,000 tons from a single line, ranking 11th in the global market with a 2 percent share.

Hyosung said it aims to become the world’s No. 3 carbon fiber producer with a 10 percent market share. Attending the signing ceremony held in Jeonju, President Moon Jae-in hailed the initiative.

President Moon Jae-in participates in a ceremony to strike a contract on investing in the Jeonju carbon textile plant on Aug. 20.

“For sustainable growth of our economy, a new growth engine industry is necessary.” he stressed. “Hydrogen economy and carbon fighter industry are among the resolutions.” He noted carbon fiber is a key material in hydrogen vehicle production amid a fierce global competition.

It’s used in making hydrogen fuel tanks, an essential part for hydrogen fuel cell electric vehicles. Carbon fiber is among materials that will likely suffer a direct impact from Japan’s move.

Moon said South Korea should depend less on a “specific nation” to obtain core materials in order for the country to become an “unshakable, responsible” economic powerhouse as he emphasized in his Aug. 15 Liberation Day address. He cited four industries as potential growth engines - non-memory chips, bio-health, future-generation cars and hydrogen economy.

Hyosung, the first Korean firm to produce carbon fibers with indigenous technology, has been mass-producing the material since 2013. Its planned investment in the sector is expected to create around 10,000 jobs, including 2,300 new ones at Hyosung.

Hyosung will build a carbon fiber manufacturing plant in partnership with Saudi Aramco, the largest petrochemical company in the world. Top executives of the two companies met Aug. 20 in Seoul and signed an agreement to establish carbon fiber manufacturing plants in Saudi Arabia or expand facilities in Korea, Hyosung said.

“We hope Aramco’s business knowhow and Hyosung’s technology will combine to boost future businesses like carbon fiber.” said Hyosung Chairman Cho Hyun-joon. Aramco CEO Amin H. Nasser also attended the signing ceremony.