Home > Business > Industry

One in three Hyundai, Kia cars made in India

Published: 28 Feb. 2024, 09:06

LEE SOO-JUNG
[email protected]

Hyundai Motor Group Executive Chair Euisun Chung inspects the group’s research development institute in India last August during his business trip to devise a mid- and long-term mobility strategy in the country. [HYUNDAI MOTOR GROUP]

One out of every three Hyundai cars manufactured overseas was made in India last year, making the country the most prominent foreign production site.

Hyundai Motor Group — comprising Hyundai Motor and Kia — produced a total of 3.67 million vehicles at overseas plants last year, more than half of all of the two companies' manufactured units.

A full 29.5 percent of all overseas units were from India at some 1.08 million cars. The runner up was the United States, which took up 19.7 percent with around 727,000 cars produced.

China-based plants made a total of 394,249 vehicles, accounting for 10.71 percent. The factories in the Czech Republic and Slovakia produced 340,500 and 340,224 units, respectively.

Domestic production came to some 3.55 million vehicles, fewer than the overseas production figure. Hyundai made some 1.94 million, while Kia produced roughly 1.6 million.

In total, the sister companies manufactured 7.23 million fully-assembled vehicles last year, according to the Korea Automobile Manufacturers Association on Monday.

The two automakers experienced a 6.67 percent increase in production volume compared to 2022’s figure of 6.78 million.

The graph shows how the production volume of Hyundai Motor Company and Kia has fluctuated over years. [KOREA AUTOMOBILE MANUFACTURERS ASSOCIATION/LEE JEONG-MIN]

Total yearly production volume, counting both domestic and overseas, peaked in 2014 with 8 million. It retreated to 6.03 million in 2020. Last year, it showed a rebound by surpassing some 7 million.

Overseas production followed a similar trajectory, registering a pre-pandemic level of production last year after reaching its summit in 2013 with some 4.1 million. The figure hit its lowest in 2020, which recorded 3.11 million.

Hyundai made 2.24 million cars in foreign factories across eight countries: the United States, India, China, Turkey, the Czech Republic, Brazil, Indonesia and Singapore. Kia produced a total of 1.43 million vehicles in five countries: the United States, China, Slovakia, Mexico and India.

While India reigned as the most significant producer, Turkey had the most exponential on-year production increase.

Turkey made some 242,100 vehicles last year, a 16.33 percent increase compared to 2022.

With its reputation for relatively cheaper labor and logistics costs, the country has attracted various global carmakers.

The Hyundai-Kia group scaled up production at its Eastern European-based plants in Slovakia and the Czech Republic. The U.S.-based plant also boosted its presence by raising production volume by eight percent over a year.

Robots carry and assemble cars at the Hyundai Motor Group Global Innovation Center in Singapore. [HYUNDAI MOTOR GROUP]

Singapore's Hyundai Motor Group Innovation Center generated its first output last year with 595 vehicles manufactured.

However, China-based plants lost their foothold.

Once reaching nearly 2 million cars during its heyday in 2016, the country's annual production volume plummeted to some 394,249 last year.

After the deployment of the Terminal High Altitude Area Defense system, or Thaad, in Korea, which stirred up anti-Korean sentiment in China, Korean automakers have been experiencing sluggish sales in China.

Hyundai Motor Group once had a total of five production sites in China. However, it currently only has three and plans to sell off a plant in Changzhou.

Factories in Indonesia, Mexico and Brazil also saw decreases in production volume.

Hyundai Motor's plant in St. Petersburg in Russia. The plant was purchased by a Russian firm last year. [HYUNDAI MOTOR GROUP]

The war between Ukraine and Russia severely affected Hyundai’s operations in Russia, leading its St. Petersburg-based plant to produce nothing last year.

The plant used to manufacture more than 200,000 cars annually until operations were suspended in May 2022. A Russian firm purchased the factory last year for $111.

The balance between overseas and domestic production is becoming even.

The ratio of domestic production was lowest in 2016, marking 41.03 percent of the total that year. However, with the Covid-19 pandemic causing the overseas plants to shut down operations, the ratio of domestically made units soared to some 48.46 percent in 2020, before reaching 49.12 percent last year.

BY KO SUK-HYUN [[email protected]]