Three of the world's biggest steel manufacturers will team to produce automotive steel in China. Arcelor SA, Nippon Steel Corp. and Shanghai Baosteel Group Corp. last week signed an agreement to create a joint venture to produce steel for automobiles. The operation, to be located in Shanghai, will have an annual production capacity of 1.7 million tons of flat carbon steel and will comprise cold rolling and galvanization operations, according to a press statement by Luxembourg-based Arcelor. "This new joint venture with our partners Baosteel and Nippon Steel is a strategic move to accompany our global automotive customers and to seize the tremendous growth opportunities offered by the Chinese market," said Arcelor CEO Guy Dolle. Baosteel will take 50% equity in the new company, Tokyo's Nippon Steel will take 38% and Arcelor will hold 12% equity, Arcelor reported. New steel facilities, budgeted at $800 million, are scheduled to begin supplying customers in the second quarter of 2005.