The FINANCIAL -- Hyundai Motor has commenced production at its fifth passenger car plant in China to meet the demands of the fast-growing new car market in inland China.
The new plant in Chongqing, a joint venture with Hyundai Motor’s local partner Beijing Automotive Industry Holding Co., has an annual capacity of 300,000 vehicles and will help Hyundai Motor increase local production of SUVs, the fastest-growing segment in China.
With the addition of latest factory, Hyundai will have a 1.65 million-unit annual capacity for passenger vehicles in the world’s biggest auto market. The creation of the new facility will also enable Hyundai Motor to maximize the significant and expanding sales opportunity across south-west China, part of the country where development has been accelerated by the Chinese government’s Belt-Road initiative, according to Hyundai Motor.
“The Chongqing plant, constructed as a smart and eco-friendly facility utilizing cutting-edge technologies, will produce vehicles of the highest quality for Chinese cutomers,” Hyundai Motor Vice Chairman Euisun Chung said at a ceremony to commemorate the start of pilot production. “We expect the new facility to contribute to Chinese government’s Belt-Road initiative and help Chongqing emerge as a new growth engine for China’s future.”
Following the Chongqing plant’s official opening in August, the first model to be built will be a small sedan, targeting young and dynamic Chinese customers. The plant is expected to produce 30,000 vehicles by the end of this year and will build four models by the end of 2019 – two small sedans and two compact SUV models.
To meet Chinese customers’ changing needs, Hyundai plans to introduce three to four new models every year, expanding the current line-up of 12 models to 14 by 2020. By then the company will have seven SUV models in production, compared with four in 2017.
As Hyundai Motor looks to build on its values of delivering clean mobility in China, it will launch six eco-friendly models by 2020. This begins with the introduction of an electric version of the Yuedong sedan by the end of 2017, followed by plug-in Sonata in the first half of 2018.
Hyundai Motor and Beijing Automotive have jointly invested $1 billion in the purpose-built plant, which has floor space of 298,000 square meters and is located on a 2.03 million-square-meter site. The facility will enhance Hyundai Motor’s design and R&D capabilities in China, allowing it to expand its range of vehicles to include further eco-friendly models, in addition to stepping up its innovations in IT and connected technologies.
The new plant continues Hyundai’s efforts to strengthen its core competitiveness and increase its market share in China. The August 2017 opening of the new plant comes nearly 15 years after the company started producing automobiles as Beijing Hyundai Motor Company (BHMC) on October 18, 2002.