Journalist
Candice Kim· Han Jun-gu
candicekim1121@ajupress.com
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POSCO, Hyundai Steel report disappointing first-quarter results SEOUL, April 25 (AJP) - South Korea’s top steelmakers, POSCO and Hyundai Steel, posted disappointing first-quarter results as a confluence of weak global demand, Chinese oversupply, and new U.S. tariffs weighed heavily on the industry. POSCO Holdings reported 14.96 trillion won ($11 billion) in revenue from its steel division and an operating profit of 450 billion won ($330 million), according to financial statements released Friday. Hyundai Steel swung to an operating loss of 19 billion won on sales of 5.56 trillion won, following a net profit a year earlier. The company also reported a net loss of 54.4 billion won for the quarter. Though POSCO’s profits rose 32 percent year-on-year — thanks in part to higher product prices and aggressive cost-cutting — they remain significantly below the 1.33 trillion won it posted during the peak of the steel cycle in early 2021. Hyundai Steel, meanwhile, saw its sales fall by 6.5 percent, a stark reflection of the industry's deepening malaise. A steep decline in construction activity, a key driver of steel demand, has hit both companies hard. Residential construction starts in South Korea totaled just 26.9 million square meters last year — roughly 70 percent of average levels — according to the Korea Construction Industry Research Institute. The drop has sharply reduced shipments of rebar and other construction-grade products. At the same time, Chinese steelmakers have flooded the market with low-priced exports, undercutting Korean producers by as much as 30 percent. In response, Hyundai Steel last July filed an anti-dumping petition against Chinese manufacturers of steel plate and hot-rolled coil. “Chinese oversupply is a structural threat to our competitiveness,” a Hyundai Steel official said, requesting anonymity to speak candidly. New U.S. trade policies have further exacerbated the industry’s woes. Under measures enacted in March, the Trump administration imposed a 25 percent tariff on all imported steel and aluminum products. As a result, Korean steel exports to the United States fell 10.6 percent year-on-year last month. Analysts warn the decline may deepen, given the typical lag between export contracts and shipments. Facing mounting pressures, both companies are accelerating overseas investments as a long-term hedge. POSCO is moving forward with a joint venture steel mill in India with JSW Group and has signaled increased collaboration with Hyundai Motor Group in the mobility sector. The company is also planning a co-investment in a U.S.-based steel mill to mitigate the impact of American tariffs. Hyundai Steel, for its part, announced plans last month to build an electric arc furnace integrated mill in Louisiana, with an annual capacity of 2.7 million tons. The plant will supply automotive-grade steel to Hyundai, Kia, and other global automakers. 2025-04-25 16:31:33 -
LG Electronics weighs US appliance price hikes amid tariff pressures SEOUL, April 25 (AJP) - LG Electronics is weighing potential price increases for U.S.-bound home appliances if tariffs imposed by Washington surpass what the company considers sustainable, according to CEO Jo Joo-wan. Jo said that while the company is striving to offset the impact through operational efficiencies, it is preparing for a range of scenarios — including higher consumer prices. “We will absorb as much as possible through operational efficiencies,” Jo told reporters Thursday ahead of a special lecture at Seoul National University. “But if tariffs rise beyond manageable levels, we may be forced to increase prices.” The remarks come as the United States enforces a universal 10 percent tariff on imports, while reciprocal, country-specific tariffs remain temporarily suspended. However, LG is bracing for the possibility of broader levies and disruptions to its global supply chain. Currently, LG manufactures washers and dryers at its Tennessee plant, while producing refrigerators, cooking appliances, and televisions in Mexico, and additional home appliances in Vietnam. In the face of further tariff escalation, the company is contemplating relocating major production facilities to the United States, utilizing a swing production model to shift output across regions, or raising prices to offset increased costs. “Building a production base in the United States is considered a last resort,” Jo said, noting that price adjustments and production realignment would be prioritized first. “We should follow sequential scenarios.” During its first-quarter earnings call, LG said it had already developed a comprehensive tariff response strategy, including manufacturing cost improvements and customer consultations regarding potential price increases. Jo also indicated that the full financial impact of tariffs is expected to emerge in the second quarter, with minimal front-loading of purchases by U.S. consumers in the first quarter. “Whether performance deteriorates or improves due to tariffs, it will start from the second quarter,” he said. In the first quarter of 2025, LG reported consolidated revenue of 22.74 trillion won ($16.8 billion) and an operating profit of 1.26 trillion won ($930 million). Turning to the company’s plans for an initial public offering of its Indian subsidiary, Jo signaled a cautious approach amid global volatility. “Whether it’s June or later, we want to wait a few months given the significant global uncertainties,” he said. “Our goal is not just to raise capital — we want the company to be properly valued and to enhance shareholder value.” 2025-04-25 15:57:02 -
SK Telecom to divest entire Kakao stake in $300 million block deal SEOUL, April 25 (AJP) - SK Telecom said Friday it will sell its entire stake in Kakao Corp. through a block deal valued at 413.3 billion won ($300 million). The sale involves 10.8 million shares of the internet company. SK Telecom said the move is aimed at securing funds for the full acquisition of SK Broadband, as well as investments in future growth areas, including artificial intelligence. SK Telecom signed a stock purchase agreement in November to acquire the remaining 24.8 percent stake in SK Broadband held by Taekwang Group and Mirae Asset Group, which own 16.75 percent and 8.01 percent of the broadband provider, respectively. The deal is valued at 1.15 trillion won, with shares priced at 11,511 won apiece. The transaction is expected to close by next month, making SK Broadband a wholly-owned subsidiary. Despite the divestment, SK Telecom said it intends to maintain its strategic partnership with Kakao. The two companies exchanged stakes worth 300 billion won in 2019 and have collaborated on cloud services and joint fund operations. “Close cooperation between the two companies, such as cloud business collaboration and joint fund operation, will remain unchanged,” an SK Telecom official said. 2025-04-25 13:43:12 -
Korea will negotiate with US to eliminate tariffs SEOUL, April 25 (AJP) - South Korea and the United States have agreed to hold negotiations aimed at eliminating mutual tariffs and item-specific duties before a July 8 deadline, South Korean officials said Friday, following high-level trade talks in Washington. The talks come ahead of the expiration of a 90-day mutual tariff suspension instituted under U.S. President Donald Trump. The two nations now hope to forge a comprehensive agreement — referred to by South Korean officials as a “July package” — that would permanently eliminate the tariffs. Speaking at the South Korean Embassy following a “2+2 high-level trade consultation,” South Korea’s Deputy Prime Minister and Finance Minister, Choi Sang-mok, said the two countries had reached a “consensus” to focus negotiations on four priority areas: tariffs and non-tariff measures, economic security, investment cooperation, and currency policy. Trade Minister Ahn Duk-geun, who met separately with U.S. Trade Representative Jamieson Greer, said he again called for exemptions from all mutual tariffs and other related duties. Additional talks between Ahn and Greer are expected to take place in Seoul on the sidelines of the Asia-Pacific Economic Cooperation (APEC) trade ministers’ meeting, scheduled for May 15–16. Among the issues discussed, the automotive and shipbuilding sectors took center stage. “We focused our explanation particularly on the automotive sector, which would have the most negative effects on our economy,” Choi said. Ahn noted that there was “considerable consensus” on future cooperation in shipbuilding. U.S. Treasury Secretary Scott Bessent, offering a more accelerated timeline, suggested an agreement could come sooner than expected. “We had a very successful bilateral meeting with Korea today,” Bessent told reporters at the White House. “We can move faster than I thought. We will discuss technical conditions as early as next week, and could reach an ‘agreement on understanding’ during next week.” “The Koreans came early,” he added. “They brought their A game, and we will see if they deliver.” 2025-04-25 10:20:43