POSCO International signs parts supply deal with US EV startup Rivian

POSCO International Corp., the trading unit of South Korea’s steel giant POSCO, said on Thursday it has signed a $6 million contract to supply electric vehicle components to US EV maker Rivian Automotive Inc.

POSCO International will supply output shafts, manufactured by Korean auto parts maker Myeongcheon Industries Co. (MCI), to Rivian for use in about 90,000 units of its electric vehicles.

The output shaft is the component that carries the power out of the transmission to the wheels.

Rivian, financially backed by Amazon and Ford, manufactures the R1T, an all-electric pickup truck, and the R1S, an electric SUV. The company receives battery packs from Korean battery maker Samsung SDI Co.

Listed on Nasdaq last month, the US EV startup has been in the global spotlight for its potential to become the next Tesla.

POSCO International’s latest deal marks its third EV component contract with Rivian.

It began business dealings with Rivian in August 2020 by supplying half shafts produced by another Korean auto parts maker Erae AMS Co. to the US EV startup.

In September of this year, POSCO International and Erae won a 145 billion won ($122 million) order to supply half shafts for some 340,000 EVs to be made by Rivian.

A half shaft works as a driving shaft in the battery electric cars.

Last year, POSCO and Erae also signed a 64 billion won deal to supply half shafts to Vietnamese automaker Vinfast Corp.

POSCO International has won a total of 400 billion won worth of orders for EV components from overseas companies in the past two years.

Write to Jung-hwan Hwang at jung@hankyung.com
In-Soo Nam edited this article.