| CHENNAI: Hyundai Motor India (HMIL) plans to invest $1 billion overall in its second plant, which commenced operations here on Saturday. This will further strengthen its resolve to make India its global hub for manufacturing small cars.
As part of its expansion programme, the company has so far invested $750 million and plans to invest the balance over the next couple of years. HMIL, which kick-started its operations by breaking ground for its first plant near Chennai on December 10, 1996, had invested $733 million during first phase.
“We have recorded huge success in India over the last ten years. Our new plant will be the platform for future growth. I’m sure HMIL will play its role perfectly as a global manufacturing hub for all of our small car models,” Mong-Koo Chung, chairman & CEO, Hyundai Motor said here on Thursday.
Earlier, Tamil Nadu chief minister, M Karunanidhi inaugurated the second plant operations amidst the presence senior officials of the state government as well as from Hyundai, besides R C Panda, Union secretary, ministry for heavy industries.
“Hyundai had set up a plant initially with a capacity of 1.3 lakh units per annum. In less than ten years since then, it has now scaled up its capacity to 6.3 lakh units per annum, which is a record growth for any car manufacturer in India,” Mr Karunanidhi said.
Later, addressing a press conference, HMIL president, Ashok Jha said the company will invest $1 billion, earmarked for the second plant, by 2013 and create facilities to manufacture 3-3.3 lakh cars per annum. This will be in addition to the 3 lakh cars capacity of the first plant.
Cumulatively, HMIL will be investing close to $1.75 billion in its Irungattukotai facilities. In addition, the vendors, who had invested $262 million in the first phase, will be investing a further $562 million to cater to HMIL’s expanded capacity.
The new plant will largely be used to manufacture ‘I10’, besides rolling out other small car models being planned. The new production line can assemble four different models at a given time.
HMIL is also investing $40 million in its R&D facility in Hyderabad, which will also be used to design new cars. The construction for this facility, coming up on 15 acres, has already began.
The company, which has become the largest exporter of cars from India, expects the requirement from overseas market to rise steadily. “We expect about 40-50% of the total cars, produced in the two plants near Chennai, to shipped for exports,” Mr Jha said.
He said, the company expects to produce 5.3 lakh cars this year. This is expected to go up to 6-6.3 lakh by next year. HMIL is not looking at the option of making a car cheaper than Nano.
“Nano will not affect our business. But we expect it to expand the overall market for cars,” Arvind Saxena, vice president - marketing & sales. “We are focused on small car segment. We will be a significant player in this segment, which accounts for 74% of the total cars sold in India. |
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