Additional Investment
in U.S. Factories

Hyundai Mobis to invest $55 mil. to expand auto parts production in U.S.

Hyundai Mobis Co. is making a step towards becoming a global parts maker by expanding its global production network and manufacturing of core parts such as lamps, steering and brake systems.
The auto parts maker also broke ground for its new plant in Gimcheon, North Gyeongsang Province, to produce auto lamps, and gear boxes, among others.
The plant to be built on a land some 130,000 square meters wide will cost the company 230 billion won located in the second Gimcheon Industrial Complex. The first stage of the project targeted to be completed in 2013 will be finished next year.
When the entire project is completed, it is estimated that some 25 cooperative companies will set up plants in the industrial complex, creating some 2,000 new jobs and an increase of 3,000 new residents in the city.
The company told stock analysts and fund managers on March 9 at the Korea Exchange building in Seoul that it plans to invest 675 billion won, up 26.4 percent from last year.
The auto parts maker said it will invest $55 million alone in its Georgia plant in the United States to expand the plant to expand the supply of its auto parts to both Hyundai Motor and Kia Motors plants in the U.S.
Mobis said at the investor relations session it will beef up sales by 5.4 percent to 8.61 trillion won and operating profit by 3.8 percent to 848 billion won. It also plans to bring the debt ratio down to 61.5 percent.
To achieve such goals, Hyundai Mobis said it will strengthen the manufacturing of core parts, develop an electronic chassis technology and expand global production bases and after-market parts exports.
Aiming to become one of the world's top 10 parts makers, Mobis plans to innovate upon its management system to raise cost competitiveness amidst the Korean's won't climb and unstable oil prices.
In addition to enlarging production capacity at Jiangsu, China, Mobis will begin making modules in India, break ground for new factories in the Czech Republic and the southern U.S. state of Georgia, and push for construction of a second plant in Beijing. Having succeeded in supplying complete chassis modules to Chrysler last year, Hyundai Mobis will continue to seek to broaden its customer base.
The company plans to increase the production capacity of anti-lock brake systems and electronic stability control systems from the current million units to 2.4 million units, conventional brake systems from 1.7 million to 3 million units and airbags from 2.2 million to up to 3.25 million units.
As for steering systems, Mobis said it will double the output of motor-driven power steering systems and steering columns to 800,000 and a million units, respectively, while increasing the production of lamps from 730,000 to 2.03 million units.
The company also plans to double the number of its overseas logistics bases to 28 and integrate its domestic network to maximize customer satisfaction.
It will develop and extend new lucrative businesses by launching a second brand and stretching out its after-market business. Wider usage of the bar code system which helps keep track of product delivery would raise operational efficiency, Mobis said.
For research and development, Mobis has earmarked some 117.6 billion won in investment, up 26.5 percent from last year. The company plans to develop an integrated chassis control system which controls the steering, brake and suspension, head lamps with core functions and a safety system that puts the airbag, the belt and the steering part to work.
Mobis has become such an important factor for Hyundai Motor and Kia Motors that they cannot do without the company. It has plants all over the world at locations where those auto makers operate car plants. In addition, the company supplies auto parts to some 200 countries around the world. The company supplies AS parts to some 26.37 million cars around the world, which means that virtually every car on the streets around the world use AS parts made by Mobis, which produces some 1.2 million car parts and maintain them.
Mobis launched the project to build or secure its logistics centers around the world. It began the construction of logistics centers in the U.S., the Middle East and Shanghai, China. It has logistics centers in Belgium, Shanghai, Dubai, Bremen, Germany,Miami, the U.S., Beijing and Moscow. It plans to secure 28 part supply centers in the world soon by building new ones in such places as Stockholm, Chennai, India, Gwangjou, and Sao Paolo. nw

(photo above) An inside view of Hyundai Mobis U.S. plant.
Vice Chairman Han Kyu-hwan of Hyundai Mobis.