Hyundai Motor to Build Second
Assembly Plant in India
- Investment to go to overseas exploration of oil and production facilities
Hyundai Motor Co. will build a second assembly plant in India, Hyundai Motor Co. Chairman and CEO Chung Mong-koo announced today during an inspection tour of the company's manufacturing complex in the southeastern port city of Chennai.
"Hyundai Motor India Ltd. (HMIL) will serve as one of our key global manufacturing centers. India along with Brazil, Russia and China show the greatest growth potential and these are the markets of the future," said Chairman Chung.
HMIL's 150,000 unit per annum second plant will be built on a 2.1 million square meter site adjacent to the existing facility at Chennai with construction work set to begin in April of this year. When completed by 2007, HMIL's annual manufacturing capacity at Chennai will be increased to 400,000. In addition to serving the Indian market, output from Chennai's second plant will be shipped to Europe, Latin America and neighboring markets, including the Middle East region.
The second plant will build the successor to Santro, HMIL's highly successful minicar which has been a runaway best-seller. HMIL is targeting an Indian market share of 20 pct or more in 2007.
With the quick rise in India's middle class and disposable income, India has become one of the fastest growing car markets in the world. In 2003, Indian car sales reached 650,000 units and 800,000 units last year. This year, sales of 920,000 units are forecast. Based on recent growth trends continue, India's car market will grow to 1.15 million units by 2007, 1.45 million by 2009 and 1.62 million by 2010.
With these high numbers at stake, the subcontinent has turned into a into a competitive battleground for the world's leading automakers. The nation's number one automaker Maruti will expand annual production capacity from the current 350,000 units to 600,000 by 2007. Tata is set lift its capacity from 150,000 to 225,000 by end of this year. GM, Toyota and other makers are embarking on expansion of their manufacturing facilities as well.
HMIL started manufacturing in Sept. 1998 with Santro minicar as its first model. Hyundai quickly established a reputation among Indian new car buyers as a high quality brand offering the latest technology at an affordable price. In the wake of Santro's success, the company added Accent, Elantra, Sonata and Getz to its portfolio of Indian-built Hyundai cars.
The company made news when in November 2003 HMIL's cumulative sales reached 500,000 units, achieving a growth rate unprecedented in the Indian car industry.
In 2004, HMIL sold 215,630 units, posting a 43 percent y-o-y increase. HMIL is confident of its growth prospects and aspires to leadership in the market. HMIL's sales target for 2005 has been set at 250,000 units to achieve a 100 pct capacity utilization ratio. HMC's fully-owned subsidiary hope to reach sales of 310,000 units by 2007 and 400,000 units by 2010.
HMIL's dealer network will be increased from 146 to 180 sales outlets this year. And with the company's greater focus on the quality of its after-sales service, HMIL's service network will expand from 408 outlets to 480.
Santro has earned the crown of India's best-selling minicar and its stablemate, Getz, introduced in Sept. 2004, is fast growing in popularity. Getz was voted 2005 Car of the Year by CNBC India, trumping models from the Big Three, Japan and Europe.
As Hyundai expands its globalization efforts with new manufacturing investments in China, the United States and Turkey, HMIL is rapidly securing its place as an important global manufacturing hub serving India as well as markets in Europe, the Middle East and Latin America.
Established in 1967, Hyundai Motor Co. has grown into the Hyundai Kia Automotive Group which includes over two dozen auto-related subsidiaries and affiliates. Employing over 50,000 people worldwide, Hyundai Motor posted US$26.1 billion in sales in 2004 (on a non-consolidated basis). Hyundai motor vehicles are sold in 193 countries through some 5000 dealerships and showrooms. Hyundai Motor Co. is a sponsor of the 2006 FIFA Germany World Cup. Further information about Hyundai Motor Co. and its products is available at http://www.hyundai-motor.com nw
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