Financial Daily from THE HINDU group of publications
Saturday, May 08, 2004
Financial Daily from THE HINDU group of publications Saturday, May 08, 2004 |
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Corporate
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Outlook Hyundai India's Mexican exports on despite possible break-up with Daimler S. Muralidhar
Chennai , May 7 HYUNDAI Motor India's exports of the small car Atoz to Mexican market is unlikely to face rough weather even if the equity partnership between the company's Korean parent — Hyundai Motor Company (HMC) and DaimlerChrysler AG is snapped. The Hyundai Santro Xing (in the domestic market) is badged as the Dodge Atoz, a DaimlerChrysler brand, and is exported to the Mexican market by Hyundai Motor India (HMI). When contacted the South Korean company's official spokesperson, Mr Oles Roman Gadacz, Director - Global Public Relations, HMC, said that HMI's exports of the Dodge Atoz will not be affected by the possible break-up of the company's alliance with DaimlerChrysler AG. He reiterated that the two global auto companies are committed to working together on a project-to-project basis and that the exports to Mexico are backed by a contractual agreement. In April 2004, the Indian subsidiary of the Korean automobile company had exported its first batch of the Dodge Atoz manufactured at its plant in Irrungattukotai. However, the break down of the equity partnership between the two could threaten the exports of these cars to this key North American market. International newswires and German and Korean newspapers have quoted sources in both HMC and DaimlerChrysler saying that the alliance between the two companies is set to snap. Accordingly, DaimlerChrysler is expected to sell its 10.5 per cent equity stake in HMC through a block sale. As a result of the break-up, the two companies could drop plans to form a commercial vehicles joint venture with the Korean company. HMI officials refused to comment on the snap in ties, but mentioned that the possible fallout of the separation could have a long-term impact on its exports to Mexico. The officials said that a formal response from the Korean parent is awaited about the future of the relationship. However, the HMI officials also pointed out that exports to Mexico constituted only a small segment of the company's total exports. Industry sources also added that Hyundai's arrangement with DaimlerChrysler for the Mexican market is based on the economic viability of importing and selling the small car in that market. The German car major had decided to source the Atoz from HMI so that the car could be one of its first foray's into the emerging small car segment in Mexico, the sources said. HMI had exported a total of 42,113 cars during the year ended March 2004, including its export of the Dodge Atoz to the Mexican market. Mr Gadacz also mentioned that as part of the company's exports to the Mexican market, under the arrangement with DaimlerChrysler, HMC and HMI had together shipped about 25,000 units of three vehicles - the Atoz, Verna (new variant of the Accent) and Porter, a pick-up truck.
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