China's Baoshan Iron and Steel (Baosteel), Baowu Aluminum, and Japan's Kobe Steel have unveiled plans to create a joint venture focused on the production of automotive aluminum sheets. With Kobe Steel taking a 50% ownership stake and Baosteel and Baowu collectively holding the remaining 50%, the companies expressed intentions to establish the new entity pending necessary regulatory clearances. The collaboration is set to cater to China's domestic automotive market, running operations at two facilities located in Tianjin and central Henan province.
The aspired partnership, tentatively named Kobelco Baosteel Automotive Aluminum Rolled Products, is expected to be headquartered in Shanghai with an initial registered capital of 900 million yuan ($125 million). Baosteel, a subsidiary of China Baowu Steel Group, which stands as the world's largest steelmaker, aligns with Kobe Steel, Japan's third-largest steelmaker, in a concerted effort to explore opportunities within the automotive aluminum sector. This initiative follows an earlier announcement from February 26, wherein the companies outlined plans to conduct a feasibility study to gauge the viability of such a joint venture.
In line with their strategic collaboration, Baosteel, Baowu Aluminum, and Kobe Steel aim to forge a path within the automotive industry, specifically targeting the production of aluminum sheets, integral materials for car manufacturing. The joint venture's geographical positioning in Tianjin and Henan province underlines a strategic move to serve China's automotive sector, utilizing the strengths and expertise of each participating entity to enhance the production and supply of aluminum products tailored for the country's automobile manufacturers.