Hyundai Motor Co. is revisiting its plans to build an Electric Arc Furnace (EAF) steel mill in the United States to support its North American operations. This development comes as the South Korean automaker looks to bolster its local steel production capabilities for vehicle manufacturing.

Hyundai’s Commitment to North American Production and EAF Steel Mill

During a January earnings call, a Hyundai executive reiterated the company’s interest in constructing a flat-rolled steel mill in the U.S. While the project has not yet been confirmed, Hyundai confirmed that it is actively reviewing the possibility of investing in an EAF steel mill.

A Hyundai spokesperson clarified that the company is considering the construction of the mill but did not offer further details. According to reports, the U.S. Southeast is being considered as a potential location for the mill. This region is already home to several recycled-content EAF mills, making it an attractive option for Hyundai’s proposed steel facility.

The new steel mill would serve Hyundai’s growing manufacturing base in the U.S., which includes plants in Alabama and Georgia that together have the capacity to produce over 700,000 Hyundai and Kia vehicles annually. Additionally, Hyundai is advancing its plans for the Hyundai Motor Group Metaplant America (HMGMA), which will be the company’s first full EV manufacturing facility in the U.S., with the ability to assemble 300,000 electric vehicles per year.

Steel Mill Investment Linked to U.S. Tariff Policies

Hyundai’s decision to build the EAF steel mill in the U.S. is also influenced by U.S. tariff policies, especially those considered during the Trump administration. The automaker, which currently relies on South Korea for all of Hyundai Steel’s melt shop capacity, is keen on reducing dependency on overseas steel production. This move could help mitigate potential trade-related risks and ensure a more reliable, cost-effective supply of steel for its U.S. operations.

In March 2024, Hyundai set up a committee to explore the feasibility of investing in steelmaking capacity in the U.S., reflecting the company’s long-term strategy to enhance its local supply chain and production efficiency.