The Telegraph
Since 1st March, 1999
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Hyundai shortlists two for Europe base

Seoul, Nov. 26 (AFP): South Korean auto giant Hyundai Motor, which has shortlisted Poland and Slovakia for its first European plant, said Wednesday it is seeking a site which ensures competitive low-cost production.

Hyundai Motor Co, the biggest car maker in Korea, will announce its decision on the location in mid-February, spokesman Jake Jang said.

“Both Poland and Slovakia have a 50-50 chance,” Jang said.

“Top priority goes to competitive production costs. Hyundai Motor will select a bidder where it can manufacture more price-competitive cars than the other.”

More screening surveys of Poland and Slovakia will follow before the final selection, he said, declining to comment on which is more preferable.

Hyundai Motor plans to invest $1.5 billion to build a plant to produce 300,000 cars annually. Construction is to begin in 2005 and the first cars will come off the assembly line in 2007. The plant will serve as Hyundai Motor’s first production presence and a significant car-export base in Europe.

Poland, Slovakia, Hungary and the Czech Republic had recently been in the heated race to attract Hyundai Motor’s planned investment.

Hyundai Motor said on Wednesday that it had officially dropped Hungary and the Czech Republic from the bidding list because of their relatively higher wages.

Slovakian interior Minister Pavol Rusko on Tuesday remained upbeat after Hyundai Motor included his country was now on the shortened list. “Our chances are greater with Poland than they would have been if the Czech Republic had stayed in the race,” Rusko said.

“We have demonstrated that we are capable of succeeding in an international competition. The fact that the Czech Republic and Hungary were eliminated is a considerable boost for us and proof that our economy is definitely competitive,” he said.

If Slovakia were to emerge as the winner it would be its second major success in attracting investment from an oversees car company.

Last year, French group PSA Peugeot-Citroen hesitated between Bratislava and Warsaw before opting for the Slovak town of Trnava for its plant, which is set to produce 300,000 vehicles per year from 2006.

Poland, for its part, had a more cautious reaction. “The fact that Poland has been retained is already a success but we must not forget that we now enter into the most difficult stage of negotiations,” said Andrzej Zdebski, head of the Polish investment agency PAIiIZ.

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