April 18, 2017 11:29
Kia is set to build its first auto factory in India at a cost of W1 trillion, industry sources said on Monday (US$1=W1,138). The new plant will be the carmaker's fifth overseas production base.
Kia will reportedly sign an investment agreement with the Indian state of Andhra Pradesh late this month. The state will provide the company with a 2.31 million sq.m site for the plant, which will have an annual production capacity of 300,000 cars.
Construction will start in May at the earliest, with a view to completion by 2019. The factory will produce compact sedans and SUVs for the local market.
Its affiliate Hyundai currently operates two factories in the Indian city of Chennai with a combined annual capacity of 650,000 cars.
India imposes a 60 percent tariff on auto imports, making local production essential. Without a local factory, Kia has yet to establish a presence in the country. It spent two years looking for a site for the new plant.
"When the factory is complete, Hyundai and Kia's overall [Indian] production capacity will reach nearly 1 million cars, and this will help them expand their presence in the Indian market," said Lee Hang-koo at the Korea Institute for Industrial Economics and Trade.
- Copyright © Chosunilbo & Chosun.com