New Delhi, Oct. 24: South Korean automobile giant Hyundai Motors is mulling the option of shifting the production line for Getz, its compact car model, to India.
The parent company is seriously considering the proposal as it will pare production and labour costs which are fairly high in South Korea and turn India into its export hub.
Confirming the development, Arvind Saxena, vice- president (sales and marketing) of Hyundai Motors India Limited (HMIL), a 100 per cent subsidiary, said: “At the moment, we are only considering this option. Yes, we are in an advanced stage of discussion with our parent company. But nothing has been finalised yet.”
It is learnt that the Hyundai management in Korea discussed moving the production line of Getz to India at a meeting in its Ulsan factory last week.
If the proposal is cleared, the production line for the Getz — it is also marketed as Click in some markets — may be shifted to HMIL’s production facility at Chennai by the end of 2007.
Click or Getz, is currently manufactured in Ulsan, where the company produces approximately 2 lakh units a year.
Last year, Hyundai produced 2 lakh units of the Getz in South Korea and 15,151 for domestic consumption in India. At present, HMIL only exports Santro and Accent from India.
Facing stiff competition and high production costs in Korea, Hyundai Motors plans to shift the production of its small cars to low-cost countries such as India and China.
The Korean carmaker has been toying with the idea of turning India into an export hub for quite sometime.
Saxena had earlier said HMIL was looking to export 50 per cent of its production by 2008. HMIL, which exports cars to almost 70 countries, has identified another dozen countries for exports.
The company is targeting exports of 1 lakh plus units in the current financial year. Last year, the company exported around 92,000 units.
Company sources say Hyundai will produce Getz at its existing 3-lakh-unit facility in Chennai while it will shift the production of Santro to its second plant which will be operational by October next year.