Hyundai's second Indian plant to begin production in October

Seoul February 25, 2007; Kim So-hyun writing for the Korea Hearald reported that Hyundai Motor Co. said yesterday its second Indian plant will begin mass producing its new minicars in October to meet the country's ballooning demand.

The carmaker's chairman, Chung Mong-koo, who is visiting the assembly lines in the southern Indian state of Tamil Nadu, inspected new vehicles that are currently undergoing a test production phase and encouraged his staff to keep up with the robust sales.

"In order to lead the fast-growing auto market in India, our top priority is to supply custom-made vehicles that cater to local customers' demands," Chung was quoted as telling employees at the plant yesterday. "Let's provide top quality small cars to improve customer satisfaction and win the competition against other global carmakers eyeing the rapidly growing Indian market."

Toyota Motors Corp., which operates a 60,000-unit plant in Bangalore, is reportedly considering building a second factory and introducing a new compact car. Honda Motor Co. plans to launch its first compact car in India in 2009.

The new assembly line will allow Hyundai Motor India to double annual production capacity to 600,000 vehicles. Targeting sales of 320,000 units in India this year, the carmaker plans to export the rest to about 60 countries.

The Indian demand for autos is projected to increase from 1.02 million units last year to 1.12 million this year and up to 1.62 million units by 2010, Hyundai Motor said.

Thanks to tax cuts on autos last year, compact car sales in January soared to 75,000 units, up from 53,000 units a year ago. Hyundai, with a market share of 18 percent, is the second largest automaker in India after Maruti Udyog Ltd.