Hyundai Launches Production at Second Indian Plant

Hyundai Motor Co. Ltd. this month launches fullscale production at its second passenger-car plant in India.

Hyundai Motor India Ltd. projects sales of 530,000 units this year, a 60% increase from 327,160 in 2007, a Hyundai spokesman tells Ward’s.

“We have targeted sales of 273,000 vehicles in India and 257,000 for export to overseas markets in 90 countries,” he says.

Hyundai also is considering developing a small car that will compete with the low-cost Tata Nano, the spokesman says.

“We are looking at a new microcar entry for all markets, but we are not focusing only on low price,” he says.

Hyundai invested $528 million in the new 1.9 million-sq.-ft. (176,000-sq.-m) plant, located in Sriperumbudur near the city of Chennai in southern India.

The new facility was partially completed in 2006 and began limited production of the i30 hatchback last year. The plant now has ramped up to mass production of the i30 that will be exported to Europe, South America, the Middle East and Africa.

The factory, located adjacent to HMIL’s original facility, has capacity for 300,000 units annually and doubles the auto maker’s domestic output to 600,000.

The auto maker plans to invests an additional $1 billion through 2013 to continue to expand and improve its operations in India.

Hyundai Automotive Group Chairman Chung Mong-koo says in a statement the new plant will help HMIL serve as the global manufacturing hub for all of Hyundai’s small cars.

“We have recorded huge successes in India in the last 10 years,” he says. “Our new plant will be the platform for future growth.”

India’s auto market is expected to increase 18.0% to 1.5 million units this year, from 1.26 million in 2007, and total as much as 2.3 million in 2010, of which HMIL is targeting a 25% share.