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Hyundai, Geely new plants approved by Chinese government
Shanghai. January 8 (Gasgoo.com) – China’s National Development and Reform Commission (NDRC) has recently approved Geely’s new plant in Lanzhou and Hyundai’s second plant in Beijing, according to an announcement released by NDRC on its official web.
In October 2005, Geely signed an investment agreement with the city government of Lanzou, capital city of Gansu province in China’s northwest region.
Under the agreement, Geely and Lanzhou city government would invest a total amount of RMB 400 million ($54.8 million) to build a joint venture project to build Geely vehicles. The joint venture was expected to have an annual capacity of 100,000 vehicles and would start production by the end of 2006.
However, Geely’s project was not approved in 2006 as Chinese government was concerned about overcapacity in automobile industry at that time. In 2006, Geely sold 200,000 vehicles, but it had a capacity of 400,000 units.
Interestingly, Geely has actually finished the construction of the new plant in Lanzhou even prior to government approval. Now Geely said it expects to produce 12,000 Free Cruiser vehicles by the end of 2008.
Similarly, prior to its official approval, Hyundai’s second plant has completed construction and started trial production as earlier as in November 2007. The second plant will have a capacity of 200,000 vehicles by earlier 2008 and 300,000 vehicles by the end of 2008.
Hyundai Motor’s new Elantra and Coupe vehicles will be produced in the second plant.
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