Hyundai says it mulls fourth plant in China

Yonhap News Agency (Seoul) - South Korea's top automaker Hyundai Motor Co. is considering building a fourth assembly plant in China as it seeks to meet the growing demand in the world's largest auto market, a top official in charge of China said Friday.

Hyundai and its smaller sister company Kia Motors Corp. are scheduled to raise their combined annual production capacity in China to nearly 1.8 million by next year.

Still, Hyundai Motor Vice Chairman Hsueh Yung-hsing said vehicles of Hyundai and Kia would be in short supply beyond 2015 as the Chinese market keeps growing.

"We are considering building a fourth plant in China with an annual production capacity of 300,000 vehicles," Hsueh told reporters at a Seoul hotel.

Hsueh, who oversees the China operations of Hyundai and Kia, said an inland area or western China may be a candidate site for the possible plant, though he said no specific time frame has been set for the construction.

Beijing Hyundai Motor Co., a joint venture between Hyundai and Beijing Automotive, operates three assembly plants in Beijing where it is set to finish the ongoing expansion of its third plant by next year. Hyundai would have an annual production capacity of 1.05 million units when the expansion is completed.

Dongfeng Yueda Kia Motor has two assembly plants in Yancheng in China's eastern Jiangsu province that has an annual production capacity of 440,000 vehicles. Kia is set to operate a third plant in the Chinese city next year, which would raise its combined annual production capacity in China to 740,000 units.

Dongfeng Yueda Kia Motor Co. is a joint venture between Kia, Chinese auto giant Dongfeng Motor Co. and Jiangsu Yueda Group Co.

In April, Beijing Hyundai Motor sold 85,100 vehicles in China, up 27 percent from a year ago. Dongfeng Yueda Kia sold 46,220 units in April, up 21.6 percent from a year ago, according to Hyundai.

Hyundai and Kia, the flagship companies of Hyundai Motor Group, the world's fifth-largest automotive group, said their combined market share in China accounted for 11 percent in the first quarter.

Hsueh's comment came four days after Hyundai Motor Chairman Chung Mong-koo indicated he was not mulling over expanding plants in the United States. Hyundai operates its plant in Montgomery, Alabama, while Kia runs an assembly plant in Georgia. The two plants can produce 300,000 vehicles, respectively.

A combined annual production capacity at Hyundai and Kia overseas plants reach 3.69 million vehicles, compared with 3.5 million units at their plants in South Korea.