Hyundai to expand Chennai plant

South Korea-based Hyundai Motor, India’s second largest car manufacturer, is looking to expand capacity at its Sriperumbudur plant near Chennai by more than 14 per cent

November 12, 2018

The South Korea-based auto manufacturer, India’s second largest, aims to increase the plant’s annual capacity to 800,000 units from 700,000 units

Following a meeting with Tamil Nadu Chief Minister, Edappadi K Palaniswami, the Indian unit of Hyundai anticipates investments worth US$970 million

Expansion at the company’s passenger vehicle division may lead to 700 new jobs. Agreement to be signed at the Global Investors Meet in January 2019

India, backed by favourable operational resources and high-margin production costs, has come up as a leading destination for automobile manufacturing

Hyundai Motor Co is looking to expand its manufacturing plant at Sriperumbudur near Chennai to keep up with the growing local demand, as per news reports on November 12, citing a company statement. The South Korea-based auto manufacturer, India’s second largest, aims to increase the plant’s annual capacity to 800,000 units from 700,000 units. Meanwhile, expansion at the company’s passenger vehicle division may lead to 700 new jobs. Hyundai expects to sign an agreement to this effect with the Tamil Nadu state government during the upcoming Global Investors Meet in January 2019 in Chennai.

Following a meeting with Tamil Nadu Chief Minister, Edappadi K Palaniswami, the Indian unit of Hyundai said that it anticipated investments worth US$970 million in the state. In the meeting, Hyundai asked for government incentives in taxation and support in areas such as water, electricity and transportation. The investment will support help in expanding production as well as in launch of new models and engines, not just for india, but for export markets. Hyundai said that the new capacity of 100,000 units will include 50,000 completely knocked down (CKD) units and 50,000 completely built-up units (CBU).

On completion, the Sriperumbudur plant will produce more than 10 Hyundai models, including electric vehicles within the next three years. Hyundai had previously revealed plans to launch nine car models in India, including two facelifts, two new vehicles, four full model changes and one EV over 2018-20. India, backed by favourable operational resources and high-margin production costs, has come up as a leading destination for automobile manufacturing. As a result, foreign firms such as Renault, Daimler AG, Volvo Cars, Ford Motor, Hyundai Motor, Honda Motor, Nissan Motor have invested in making in India.