logo
Plus   Neg
Share
Email

Kia Motors To Build $1 Bln Car Assembly Plant In Mexico

South Korean automaker Kia Motors Corp. (KIMTF.PK) said late Wednesday that it has agreed to build a $1 billion car assembly plant in Mexico by 2016. The company noted that the plant will enable it to secure local production base to meet global demand for new vehicles.

Kia Motors said that it has signed an investment agreement with the Mexico government to build a manufacturing plant in Monterrey, which is located in the northeastern Mexican state of Nuevo León. Kia Motors, partly owned by Hyundai Motor Co., plans to produce "a range of yet-to-be confirmed compact models at the new plant".

The company expects to commence construction of the plant in September 2014 and to complete the construction in the first half of 2016.

The plant will have an annual production capacity of 300,000 compact cars, thus boosting Kia's total global manufacturing capacity to 3.37 million vehicles. This includes 1.69 million vehicles at the company's domestic Korean plants and 1.68 million at its overseas plants.

The new, highly automated manufacturing plant will be situated on a 500 hectare site that will also be home to numerous supplier companies' facilities.

Kia Motors said that Mexico was chosen as the site for the company's next overseas plant as it is one of the few remaining major markets of the world in which Kia does not have a sales presence.

The company added that Mexico is well-known for its skilled, low-cost labor force and numerous free trade agreements with about 40 countries. Mexico is the fourth-largest auto exporter in the world.

Kia Motors noted that Mexico's proximity to the U.S. will enable the company to better address the ongoing supply shortage situation that has arisen due to the growth of the Kia brand in the U.S. market. The company also plans to utilize the Mexican plant to strengthen the brand's sales presence throughout the entire Central and South America region.

Hyoung-Keun Lee, Vice Chairman of Kia Motors, said, "We are committed to producing world-class quality vehicles here in Mexico that feature industry-leading styling and high-tech convenience and safety features that customers have come to expect from Kia, while making significant contributions to both the economic growth of the State of Nuevo León and the future development of the Mexican automotive industry."

In Thursday's trading on the Seoul stock exchange, Kia Motors stock is trading at 60,200 won, up 400 won or 0.67 percent on a volume of 347,376 shares.

by RTTNews Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Walmart Inc. has deepened its strategic partnership with Microsoft Corp. by choosing the technology giant as its preferred as well as strategic cloud provider and tap into the full range of Microsoft's cloud solutions. The five-year agreement brings together Amazon.com Inc.'s two major rivals. Walmart is Amazon's largest retail rival, while Microsoft is its biggest competitor in cloud computing. Goldman Sachs Group, Inc. on Tuesday reported a 44 percent surge in profit for the second quarter from last year, reflecting higher revenues across all segments. The company noted that revenues were the highest second-quarter revenue in nine years. Both revenue and earnings per share for the quarter beat analysts' expectations. The company's shares are down 0.4 percent in pre-market activity. Office sharing start-up WeWork said it will no longer serve meat at company events and also will not allow employee to expense meat. WeWork said it has made a commitment to be a meat-free organization. The company announced its meat-free policy in an internal memo to its global employees, saying that the move is intended to reduce the environmental impact of its business.