Japanese steel producer, JFE Steel says it will invest about $300 million to build an automotive steel sheet plant in West Java, Indonesia to accommodate increasing demand for high-end steel products for use in cars in the local market.
Located at the MM2100 Industrial Town in the city of Bekasi outside Jakarta, the facility will be built and operated by JFE Steel’s wholly owned subsidiary PT. JFE Steel Galvanizing Indonesia. Having a production capacity of about 400,000 tons per year, the new facility will produce hot-dip galvanized steel sheet for automobiles.
The new CGL facility will be JFE’s third for automobiles in Asia outside Japan, following plants in China and Thailand.
JFE will also provide technology to its business partner JSW Steel to set up CGL facilities in India, a key market in its global expansion plans.
Indonesia is Southeast Asia’s largest economy and the region’s second largest automobile producer after Thailand.
Local demand for high-end automotive steel sheet is expected to grow as automakers expand capacity in line with the expected car sales of more than 1.1 million this year, almost unchanged from 2012.
The Japanese steelmaker said it is leveraging its world-class technologies to respond to growing demands from automakers in Asian markets for increasingly sophisticated products that can be procured locally, and to contribute to the development of steel industries in these markets.
JFE Steel is affiliated with JFE Shoji, which imports and exports steel products and trades in the raw materials for steel, non-ferrous metals, chemicals, machinery and ships. The company has international operations and networks throughout Asia.
