Hyundai Motor Group offers partners supportHyundai Motor Group is committing 1 trillion won ($846 million) to partner companies under pressure from the Wuhan coronavirus outbreak.
The group announced Thursday that it will provide loans and make early payments to and make investments in 350 small- and medium-sized auto part suppliers in Korea to minimize the impact of the virus outbreak and stabilize their operations.
Hyundai Motor Group had to halt production in Korea temporarily on a staggered schedule due to a shortage of wiring harnesses caused by the outbreak. The stoppage caused delays in the production of Hyundai Motor’s high-demand models, like the Palisade, the Genesis G90, G80 and G70.
The group said it is setting aside 308 billion won for no-interest loans to the suppliers that will be delivered to its partners starting the middle of this month.
Partners of Hyundai Motor, Kia Motors, Hyundai Mobis, Hyundai Wia and Hyundai Transys will be paid early for 587 billion won worth of auto parts and be supplied 105 billion won in investment funds to support manufacturing.
Payments for mid-February will be made this month, and funds slated for mid-March will be remitted a month early.
Hyundai Motor Group said it expects the early payments to help the 350 partnering companies to do the same for smaller partners, which would be a boost for the local auto industry as a whole.
And to ensure the delivery of wire harnesses from China, Hyundai Motor Group said its Chinese branch executives are in direct discussion with the Shandong provincial government to resume operations of its partnering auto parts factories.
At the same time the group is pushing to expand the production of wiring harnesses at factories outside China. It is expanding delivery volume from factories in Korea and Southeast Asia while working to reduce the delivery time when Chinese factories resume operations.
The Ministry of Foreign Affairs and the Ministry of Trade, Industry and Energy have also been working with Chinese local governments to resume operation of wiring harness factories.
BY KO JUN-TAE [firstname.lastname@example.org]