South Korea’s top steelmaker Posco has agreed to share advanced coating technologies used to enhance automotive steel traits with London-based Tata Steel Europe Ltd. (TSE), a move that is expected to help the Korean steel maker expand its market share in Europe.

Posco said on Friday that it signed a cross-licensing agreement with TSE on Wednesday (local time) for steel plating technology in Ijmuiden, the Netherlands. Under the agreement, Posco will allow TSE to access its environmentally-friendly physical vapor deposition (PVD) technology and in exchange gain production to TSE’s patented MagiZinc. The two companies will also work together to develop innovative coating technology for steel products in the future and pioneer new markets.

Posco’s PVD technology is a coating technique that helps to significantly reduce environmental pollutants such as carbon dioxide and nitrogen oxide discharged during the general coating process because it allows metal vapors to be speedily coated on the surface of steel in vacuum condition. Steel plates applying Posco’s PVC technology can be used in automotive steel and building materials. Posco is working to launch commercial production of the technology later this year.

TSE’s MagiZinc technology, meanwhile, is an innovative coating technique with high corrosion protection capability that is widely used in automotive steel as well as in finished and equipped materials in construction-use building supplies.

With the agreement, Posco plans to expand application of its PVD technology to automotive steel products that are mainly sold in the European market and integrate TSE’s steel coating technology to its products. The company expects the partnership would help it expand its client base in the European automotive steel market and pave the way for a bigger share in the overall global market.

An unnamed official from Posco said the traits of automotive steel required by each market is different depending on different environment and weather conditions. The latest technology exchange with TSE will allow Posco to produce automotive steels that are preferred by European customers, the official added.

Sales of Posco’s automotive steel have been growing in recent years from 7.65 million tons in 2013 to 9.1 million tons last year. In 2014, sales reached 8.3 million tons, 8.7 million tons in 2015, and 9.0 million tons in 2016. To further up its presence in the automotive steel market, Posco has been focusing its resources on high-end steel material development research capability.

By Woo Je-yoon and Lee Eun-joo

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