Hyundai Motor Co. Ltd plans to begin producing electric cars in Indonesia as a part of an estimated $880 million investment within the country’s automotive industry, the deputy industry minister said on Thursday.
Hyundai’s decision to open its first automobile plant in Southeast Asia is a component of the South Korean carmaker’s strategy to scale back its reliance on China, where competition is fierce and the corporate’s sales have been hurt by diplomatic tensions between Seoul and Beijing.
Hyundai, which along with subsidiary Kia Motors is the world’s fifth-largest carmaker, plans to construct a factory in Indonesia with a capability to provide about 250,000 units, including electric cars, Indonesian Deputy Industry Minister Harjanto said. Reuters Agency.
Indonesia has large deposits of nickel laterite ore, which is a crucial component of lithium-ion batteries used to power electric vehicles.
The minister noted that the plan assumes exporting 53% of cars produced on the proposed Hyundai factory, mainly to Southeast Asia and Australia, while the remaining 47% might be intended for the domestic market.
Hyundai said in an announcement Friday that it was “considering various ways to expand” into recent markets, including Southeast Asia. But it added that nothing had been selected recent production plants within the region.
Japanese rivals
Hyundai informed South Korean unions earlier this yr about its plan to construct a factory in Indonesia, three people aware of the matter said. Reuters Agency on Friday. One challenge identified was constructing a sales network, the people said.
Hyundai-Kia think tank vp Lee Bo-sung said on Thursday the ASEAN market was difficult to “penetrate” since it was dominated by Japanese rivals similar to Toyota and Honda.
In Indonesia, Hyundai sold just 1,372 vehicles between January and October, while Toyota sold 463,565 vehicles, in accordance with data from market research firm LMC Automotive.
Hyundai doesn’t have a automobile factory in Southeast Asia, even though it does have some assembly plants in Vietnam. Last month, Hyundai announced a $250 million investment in Grab, a Singapore-based ride-hailing company, and a plan to supply electric vehicles to Grab drivers in Southeast Asia.
Source : www.livemint.com
