High
Stake
in India

Hyundai Motor to build engine, transmission plants and a R&D center in India

Hyundai Motor Co. plans to build engine and transmission production facilities and a R&D center, in addition to its second car plant being built in India, Hyundai-Kia Automotive Group Chairman Chung Mong-koo said during his recent visit to India.
Chairman Chung, during his call on Indian Prime Minister Manmohan Singh on September 20th, outlined his group's plan and asked for the support of the Indian government for the project.
He told the Indian prime minister that he plans to add the construction of engine and transmission production facilities to the second auto plant being built in India with capacity to turn out 300,000 cars per year.
"An R&D center for cars will also be built to upgrade India's auto industry importance by making Hyundai Motor an integrated automaker in India,"the automaker chairman said.
He told the top Indian leader that his company wants to contribute to the growth of India's economy through giant investment and win the respect of the regional society,
asking for the support for cooperative firms'joint advancement into India with his motor firm.
The chairman also told the prime minister how glad he was to hear that 240 electric railcars imported from Rotem in Korea are running well in New Delhi and asked for the support from the Indian government in importing 400 electric railcars ($600 million worth) needed in addition to run the second stage subway to be completed soon.
Prime Minister Singh said the Indian government has been trying to nurture the auto industry as the core industry in the next stage of the industrial development and expects that Hyundai Motor's investment would further upgrade the development of India's auto industry as well as that of related industries.
Hyundai Motor's massive investment in India is aimed at building a center for manufacturing small cars to make India a market for its small vehicles. Car makers from advanced countries such as the U.S., Europe and Japan have been making investments into India whose car market is projected to grow 10 percent per year down the road.
Both GM and Ford are eager to expand their small car production facilities in India to make up for their market share losses in the U.S. Japan's Toyota Motor also plans to build small cars priced at around 6 million won each in India.
Hyundai Motor has decided to make its Indian operation, one of its four largest global production centers in the world, after China, the U.S., and Europe, following its astounding success in India. Hyundai Motor plans to make its Indian operation, a production center for small cars not only for the Indian car market, but also for the global small car market.
Lim Hong-soo, president of the Hyundai Motor India Inc., said India has an immense potential as a car market with a population of over 1.1 billion population, endowed with young population and inexpensive wage levels and an advanced IT sector.
He said the second car plant will finished by the end of this year and go on stream in August next year,
bring total production of Hyundai cars in India to 600,000 cars per year, together with the first car plant in operation.
Hyundai Motor's first car plant produces such car models as Santro, an Indian version of Atos prime model, Click, Verna, Avante, and Sonata and its second plant will specialize in the production of small passenger cars.
Hyundai started producing cars from its first plant in Chennai in India from September, 1998, and recorded the car sales of 500,000 units in five years of its operation in 2003, a record in India's car market. Last year alone, its car sales totaled 251,717 units, up 17 percent from the previous year.
In the meantime, Chairman Chung, upon his return from India, told reporters at Incheon Int'l Airport that Hyundai Motor will expand its overseas operations in the future, meaning that the company will build plants in other locations than its Czech plant and Kia Motors'Georgia plant. He said the company will expand its operations in Asia and South America, following moves by GM and Toyota. nw

Hyundai Motor Chairman Chung Mong-koo encourages the Indian workers at Hyundai Motor plant in Inida.: Chairman Chung outlines the company's plan to increase investment in India to Indian Prime Minister Manmohan Singh in New Delhi Sept. 20.