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Facility Restructuring in Steel Industry

Dec 28,1998
Dongkuk Steel Mill will shut down one of its steel manufacturing plants on December 26. It is the first time in Korean steel industry history that a large scale steel works has closed.
Dongkuk judged the factory old enough to a warrant a shut down. This move will reduce Dongkuk's production capacity from 5.9 million tons to 4.88 million tons.
This closure will spark the revitalization of the steel industry through facility restructuring. Restructuring will start in the electrical mill industry in a self-controlled way which is completely different from other industries' restructuring efforts which were forced by the government.
Kim Yong Kil, a high ranking executive of the Korea Steel Association said, 'All products of the steel industry suffer from overcapicity. If the Hanbo Steel deal is finished, companies will seek ways of restructuring to survive.' .
A source at Dongkuk said, 'Companies should reduce over-capacity and renovate their facilities to compete in the world market. The shut-down of the factory in Pusan will spark restructuring.'
Kangwon Industry also plans to sell a factory in Pohang.


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