Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

SAIL and ArcelorMittal had signed a joint venture (JV) agreement for a high-grade cold-rolled automotive steel in 2017. For the past two years, SAIL is waiting for a response from Arcelor. With the planned acquisition of Essar Steel, this venture is expected to be scrapped or delayed further. 


The project was planned to be set-up in Andhra with a capacity of 1.5mn mt cold rolling automotive steel plant for which hot-rolled strips were to be sourced from SAIL’s Rourkela plant. Financial viability is another factor for which SAIL is now speaking to other auto-grade steelmakers like Posco and Hyundai Steel. The unit targets auto manufacturers belts in Pune-Chakan, Maharashtra and Sanand, Gujarat.


Auto industry produced a total 16,583,587 vehicles including Passenger Vehicles, Commercial Vehicles, Three Wheelers, Two Wheelers and Quadricycle in April-Oct 2019 and is expected to grow from around 3.5mn units to more than 7mn units in the next 10 years. India is forecast to become the world’s third-largest automobile-manufacturing nation by 2026.


Similar collaborations are common between steelmakers. Tata Steel and Nippon Steel have collaborated to produce high-grade cold-rolled automotive steel in India through a JV, while JSW Steel has a similar tie-up with JFE Steel, Japan for automotive steel.


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