Hyundai starts work on new Czech production facility

Hyundai starts work on new Czech production facility  
Filed under:
News, Hyundai
on 04/27/2007

Source: Hyundai

Hyundai Motor Co. has broken the ground for the construction of a 1.1 billion Euro manufacturing plant in Nosovice, Czech Republic. On completion in March 2009, Hyundai Motor Manufacturing Czech (HMMC), a fully-owned subsidiary of Seoul-based Hyundai Motor Co., will have the capacity to build 200,000 vehicles annually, increasing to 300,000 by 2011.

A European manufacturing base was deemed essential in order to achieve Hyundai’s long-term sales targets in Europe. With HMMC coming on-stream in 2009, Hyundai’s European sales are forecast to grow to 620,000 units in 2010. In 2005, Hyundai Motor Europe sold 300,000 units and in 2006, sales passed the 400,000 mark (including Russia and Turkey sales).

The first car to be produced at the state-of-the-art facility will be the new i30 C-Segment five-door hatchback, i30 Wagon and a yet-to-be-revealed compact minivan (codenamed YN).

By 2011 the plant will have the capacity to produce an additional 100,000 units per annum, enabling it to build a third model.

Dramatically increasing Hyundai’s European capability and reducing the time from point of order to supply, the new manufacturing arm will strengthen Hyundai’s price competitiveness and put it on an equal footing with established European-based automakers.

Speaking at the ground-breaking ceremony, Hyundai Motor Co. Chairman and CEO Chung Mong-Koo, said: “With Hyundai’s accumulated manufacturing experience in Korea, China, the USA, Turkey and India, we have the capability to build another truly state-of-the-art manufacturing facility that will set the standard for efficiency and productivity. When combined with the high capabilities of the Czech worker and the Czech reputation for excellent craftsmanship, HMMC has the potential to make the highest quality cars in all of Europe.”

Hyundai has already invested $50 million Euros in a European Design and Technical Center, in Germany, which designed the i30 hatchback and wagon. And it only recently opened a new European sales and marketing headquarters in Offenbach, Germany, to better support local sales. The Czech plant is the final link in the chain, giving Hyundai full capability within Europe, from design and engineering, to production, marketing, sales and after-service.

Initially, it is anticipated that 2,845 new jobs will be directly created by the HMMC. An additional 675 jobs will be created by the second phase expansion, bringing the total direct employment at HMMC to 3,520 people. At the supplier level, it is anticipated a further 4,000 jobs will be created, providing a significant impetus to the growth and development of the Czech economy. In compliance with EU guidelines, Czech authorities extended incentives valued at 15 percent of the total investment, the maximum permissible under EU regulation.

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