| Made in india
Calcutta, Nov. 17: Korean car major Hyundai Motor Company (HMC) has decided to stop the production of Santro cars in Korea and will instead source them entirely from India.
Sources said the chaebol has communicated to its 100 per cent subsidiary, Hyundai Motor India Limited (HMIL), that it will stop producing Santro cars from the end of 2003. HMIL has also been directed to increase production capacity at its Chennai plant.
“HMC is likely to stop making Santro cars from the end of 2003 and want to make India the export hub for Santro cars,” a company spokesperson said.
According to the strategy worked out by the Korean parent, it might initially source components from India for the Santro and assemble them at Korea. “Gradually from the end of next year, Hyundai Motor India will meet the entire export obligation on behalf of HMC and the latter will completely phase out production of the Santro,” sources added.
The Santro cars will be targeted at the European market where there is a demand for small cars. Hyundai is also setting up a unit at Alabama, USA, for meeting the demands of the American market.
Meanwhile, HMC and DaimlerChrysler AG’s joint venture to build commercial vehicle engines has gone another step forward with the two partners having decided to construct their new engine plant located in Hyundai Motor’s Chonju commercial plant. The 50:50 engine joint venture is called Daimler Hyundai Truck Corp.
Hyundai Motor India has invested $ 700 million in its Chennai factory and intends to pump in another $ 350 million in its Chennai factory to increase its capacity of 1.2 lakh cars per annum to 2.5 lakh per annum in phases over four years. It will launch the Terracan by the end of January or early February.
It has also firmed up plans to start exporting Santro and Accent cars to Europe from the second half of the next financial year. This year HMIL expects 8,200 cars to be exported, 80 per cent of which would be Santros and the rest will be Accent. Its key overseas markets are Indonesia, Algeria, Morocco and Bangladesh.
The company has come out with its October sales figures which shows that total car sales grew by 35 per cent to 10,437 units from 7,734 units in October 2001.