SEOUL, KOREA - Hyundai Motor will likely break the ground for a factory in Chongqing within the year's end before setting out to build the Cangzhou (Hebei Province) plant. A high-ranking official of Hyundai Motor said on November 2, "We are currently negotiating with the Chinese central government, provincial government, and Beijing Automotive Industry Holding as to the exact time to begin the construction and the Chongqing plant's capacity."

 

Earlier in March this year, Hyundai signed an agreement with the Chongqing city government to build its fourth auto assembly plant in China. Immediately afterward, however, it faced opposition from the Beijing city government and the central government that urged the company to build a factory in Cangzhou first.

 

The official added that the company's policy changed abruptly in July this year after Chinese President Xi Jinping visited Korea. At the time, the central government offered an arbitration plan that satisfied both Chongqing and Cangzhou. Others said that the leaders of the two countries will meet in the upcoming Asia-Pacific Economic Cooperation forum to be held in Beijing from November 5 and likely agree on a plan to begin construction of both factories concurrently.

 

If the investment plan goes through as scheduled, Hyundai Motor will be able to have a total capacity of 2.4 million cars in China by late 2015, including commercial vehicle production capacities in Sichuan Hyundai Motor (150,000 vehicles) and Kia Yancheng (740,000).

 

Article provided by The Korea Economic Daily