Date:19/09/2006 URL: http://www.thehindu.com/2006/09/19/stories/2006091908661600.htm

Business

Hyundai set to bring in $700 m fresh investment

Special Correspondent

To double capacity of the Irrungattukottai plant near Chennai

New engine, transmission unit planned

To roll out new compact car

IN EXPANSION MODE: Mong-Koo Chung (left), Group Chairman, Hyundai Motor, greeting M. Karunanidhi, Tamil Nadu Chief Minister, at the Secretariat in Chennai on Monday.

CHENNAI: Hyundai Motor Company of South Korea is set to bring in an additional $700 million as direct investment into India as part of its proposal to expand its capacity at its Irrungattukottai plant near Chennai in Tamil Nadu.

The proposal is to double its capacity to six lakh cars a year. A part of the investment will also go into the establishment of a new engine and transmission unit, it is learnt.

Hyundai chief meets CM

Chung Mong Koo, Chairman and CEO of Hyundai Motor Company, met the Tamil Nadu Chief Minister, M Karunanidhi, on Monday, and discussed the plans for the South Korean car company's subsidiary, Hyundai Motor India.

The fresh investment proposal by Hyundai would bring in its wake additional investments by vendors. At least 20 vendors are reported to have expressed their willingness to set up shop. This would result in a further investment of around $200 million. In all, it is hoped that the State would see a fresh total investment of around $1 billion.

A release from the company said that during his meeting with the Chief Minister, Mr. Koo sought the support of the Tamil Nadu Government in improving the State's infrastructure such as roads and railways and setting up of a new port facility exclusively for car exports.

Mr. Koo also visited Hyundai's plant. During his interaction with the workers, the release said, the Chairman emphasised the need for timely completion of the second plant, now under construction, to ensure the timely roll out of a new compact car in addition to Santro.

"With the Indian automotive industry growing rapidly, the expected market volume in 2006 is 9.7 lakh units as compared to 8.5 lakh units in 2005. This is likely to grow up to 16.2 lakh units by 2010.

And to meet the growing demand of Hyundai cars in the domestic and overseas market, HMI is aiming at an all-time high market share of above 20 per cent in the Indian market,'' the release quoted him as saying.