Hyundai mulls raising small car output in India

• IBTimes RSS
• Print
• E-Mail
• digg
• Del.icio.us

Hyundai is expected to focus on higher-end vehicles, which generate bigger margins, at home where the company faces higher labour costs and to produce cheaper models in its overseas units, such as India and China, analysts said.

The Chosun Ilbo, a South Korean newspaper said on Tuesday Hyundai is mulling a shift of its production line of the Getz, a compact car, to India by the end of 2007, citing a company official.

The company will use the line to produce all of the model for exports, according to the report.

"We are considering the subject in a bid to lift competitiveness, although nothing has been decided yet," Hyundai said in a statement.

"Even if we move ahead with the plan, we will not move a production line, but may adjust production volumes."

Hyundai produced 200,903 Getz cars in South Korea and 15,151 in India last year.

Hyundai, which has a 300,000-unit-a-year car factory in India - Asia's fourth largest economy - is building another factory there. The plant is set to start operations in October 2007 and to build a new follow-up model to the Santro small car, the company's flagship product in India.

Hyundai, the world's No.6 auto maker along with its affiliate Kia Motors Corp. by sales volumes, also has factories in the United States, China and Turkey. The company plans to begin building a plant in the Czech Republic within the year.

Hyundai and Kia plan to have around half their output abroad within the next five years. Last year they made 2.7 million vehicles at home and 750,000 abroad.