Hyundai Motor India is planning to set up a Greenfield plant. The South Korean company will spend Rs 400 crore to build the 1.5 lakh diesel engine plant, hoping to cater to the rising requirements from domestic market. The company is yet to decide on the location of the plant. Hyundai’s two car manufacturing plants are located in Chennai.
“While we are channelizing more production to India and cutting down exports, the new diesel engines would be fitted into our existing and future cars as local customers are gradually preferring diesel over petrol ,” said HW Park, MD, Hyundai Motor India.
Hyundai sells diesel models of its i20 hatchback and other bigger cars and imports the engines from South Korea. It is also looking for a third car plant in India to meet the growing demand and is awaiting final nod from the parent company.
Hyundai has already increased the allocation to the domestic market to 65% for calendar year 2011, up from the 3.56 lakh cars it sold in India, aggregating 60% of its total year production. And the company also plans to bring a car smaller than the Santro.
“We have witnessed 24% growth in the Indian market even as exports at 2.47 lakh cars were down by 8.5% in 2010 calendar year,” Hyundai’s director (marketing & sales) Arvind Saxena said.
“The small car will be the smallest model from Hyundai's global line-up and India would be one of its lead markets,” Mr Park said.