South Korean auto maker Hyundai Motor Company is going to open its first South American plant in Brazil as the company is trying to expand its overseas production base. This will be Hyundai Motor’s seventh manufacturing plant outside South Korea. The auto maker currently has plants in the United States, China, India and Turkey, while plants in Czech Republic and Russia are currently under construction. In order to avoid production strike at home and loses from foreign currency fluctuation, Hyundai is eyeing on increasing overseas production.
In fact, the company has already seen extensive increase in its overseas production since 2003 when 18.8 percent of total production was done in overseas plants. Last year, overseas plants contributed 45.6 percent to the company’s total yearly production. The new plant in Brazil will be set up in Piracicaba, 157 kilometres (94 miles) northwest of Sao Paolo. The plant will be ready for production by 2011. With production capacity of 100,000 vehicles, the plant in Brazil will create 4,000 jobs in the local market.
Alike India, China and Russia, car market in Brazil has a great potential. So, it is definitely a good move by Hyundai motor company to set a plant in the country where production cost is also expected to be less than in South Korea.
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AFP