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What lies beneath the success of global automotive giants or emerging stars such as Volkswagen and Shanghai Automotive Industry Corp. (SAIC)? Among various factors, one of the most crucial is securing high-end automotive steel plates.

In order to procure quality steel plates, which comprise the framework of a vehicle, the former holds a long-term partnership with ThyssenKrupp Steel while the latter ties up with Baosteel.

The Hyundai-Kia Automotive Group, the country's foremost carmaker, has lacked this significant advantage since the Seoul-based conglomerate depends mostly on imports for steel plates.

Yet, things will be totally different beginning in 2011 as its steel-making arm Hyundai Steel is poised to produce top-tier automotive steel plates at its recently-built blast furnace in Dangjin, South Chungcheong Province.

The mass production of steel plates is projected to equip the Hyundai-Kia group with a long-awaited vertical integration involving its four major units of Hyundai Motor, Kia Motors, Hyundai Hysco and Hyundai Steel.

Hyundai Motor and Kia Motors are carmakers in the higher echelon of the global rankings, while Hyundai Hysco manufactures automotive steel sheet products from hot-rolled steel.

``Thus far, Hyundai Hysco provided steel plates to Hyundai Motor or Kia Motors with imported hot-rolled steel. As Hyundai Steel begins to produce hot-rolled steel at its blast furnace, however, Hyundai Hysco will not have to resort to overseas materials,'' a Hyundai Steel spokesperson said.

``It was our long-held dream to realize this vertical integration system ranging from molten iron to cars. We expect a great synergy effect between the steel and automobile industries.''

Currently, around 400 researchers of the group are working on developing top-end automotive steel plates customized to the unique designs of Hyundai Motor's or Kia Motors' sedans.

Another target of Hyundai Steel and their blast furnace is thick plates. The firm strives to produce 1.5 million tons of thick plates this year, 65 percent of which will be provided to shipbuilders.

Hyundai Steel aims to maintain the proportion at 70 percent over the long haul so that it can help the country's shipyards reduce their high reliance on imports.

Furthermore, the corporation is looking to offshore demand and is set to sign a contract with Vietnam's Vietnam Shipbuilding Industry Group. Both signed a memorandum of understanding in mid-April.

Earlier this year, Hyundai Steel opened its first blast furnace with an annual capacity of 4 million tons in Dangjin, around 90 kilometers south of Seoul, and plans to open another one in the vicinity with the same capacity later this year.

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