Business
Hyundai Motor says eyes new engine factory in China
January 12, 2006
SEOUL (Reuters) - Hyundai Motor Co., South Korea's top auto maker, said on Thursday it was considering setting up a new engine plant in China as it aims to increase car production in the world's fastest-growing market.
Hyundai said in a filing to the local exchange it was considering a factory in Shandong, China, to produce up to 400,000 passenger car engines per year.
It anticipated the plant would start production from the end of 2008 to reach its full capacity later, the company said.
"We are talking to China's government to get an approval for the plan and we will push ahead the plan once we get an OK," said a Hyundai spokesman by telephone.
On Wednesday, Hyundai said it would increase engine production capacity at its Chinese joint venture, Beijing Hyundai Automotive Corp., by two-thirds.
The latest move comes after Beijing Hyundai, a 50-50 venture between Hyundai and Beijing Automotive, expanded its Chinese car plant in May, doubling capacity to 300,000 vehicles.
The expansion of vehicle production is part of an ambitious growth plan that would see the firm pumping an additional $740 million into its Chinese venture by 2007 to build a second plant to make 600,000 vehicles per year in the country.
Shares in Hyundai fell 1.39 percent to 92,500 won, underperforming a 0.61 percent rise in the broader market.