posco AMERICA

- Established a system for an annual 900,000 tons production scale. anticipating high added value for the local automobile industry

On January 28th POSCO completed construction of a second continuous galvanizing line (2CGL) with an annual 500,000 ton capacity, in Altamira, Tamaulipas state, Mexico.

300 people attended the completion ceremony, including Tamaulipas Governor Egidio Torre Cantú, Korea Ambassador to Mexico, Seonghoa Hong, and CEO Joonyang Chung, in addition to Mexican government officials and employees from major client companies, including Toyota, Honda, Nissan, and Volkswagen attended.

POSCO established a 900,000 ton scale automobile steel plate production system by completing this 2CGL factory which complements the 1CGL factory which has an annual 400,000 tons production scale and started operation in 2009. Accordingly, POSCO has become the largest production factory for plated automobile steel plates in Mexico.

The main 2CGL product will be galvanized steel plates used in the exterior panels of high end automobiles. In particular, the `GI Ace,` which has improved coating and processing capabilities, and the `780MPa class AHSS steel`, premium grade steel plate which is lighter yet more resistant to external impacts, are increasingly in demand by leading automobile companies and expected to offer high added value to the local automobile industry.

CEO Joonyang Chung said, ``The 2CGL factory is an extension of the road to friendship that POSCO and Mexico have been developing since our Mexico office was established in 1981. I would like to give my deepest thanks to the many government officials, client companies, and suppliers who made successful completion of this factory possible and POSCO will continue its efforts to supply premium quality automobile steel plates.``

Mexico is considered the most optimal production area with low labor costs and proximity to the largest automobile market in North America. Based on these advantages, global automobile companies including Volkswagen, Chrysler, GM, and Renault Nissan have entered the market, while 1,000 or so global parts companies, including Autotech and Benteler Automotive, have also clustered, making it a market with high growth potential.

In addition, Mexico exported 2.4 million automobiles last year, making it the world`s 5th largest automobile export country, and production lines for new automobile steel plates are continuing to increase at Honda, Mazda, and Nissan

In addition to its automobile steel plate factory, POSCO also has 4 processing centers: POSCO-MPPC Plants #1•2•3 and POSCO-MAPC, and will continue to contribute to local economy and automobile market promotion, while striving for sustainable growth in the local community and strengthening its global sales networks.

- POSCO completed a 500,000 ton annual 2CGL factory in Mexico on January 28th. The company thus established a 900,000 ton scale production system in Mexico, and is securing a foundation to lead high added value to the local automobile industry.

Jinsuk Jeong allysrua@posco.com