The Hindu Business Line : i10 drive: Hyundai to start working 3 shifts

Chennai, July 5 Thanks to the demand for Hyundai’s small car i10 both in domestic and export markets, Hyundai Motor India Ltd will soon begin to work a third shift at its second plant here, the company’s Managing Director, Mr H S Lheem, told Business Line today.

The i10 has sold “well over 100,000” cars in the last six months, providing enough business justification for the $ 500-million second plant that began production in February.

Higher capacity

The plant-II doubled Hyundai India’s capacity to 600,000.

With the first plant already running three shifts and the second plant soon to follow suit, Hyundai expects to meet its 2008 target of 530,000 cars.

But next year, its production will hit 600,000 cars.

Some stretching — such as working a shift or two on Sundays — would enable to Hyundai to raise capacity to 630,000.

But with the growing demand for the i10 and the proposed launch of i20 (a car like the ‘Hyundai Accent’) by the end of this year, even that capacity would not be enough.

For beyond next year, the company will need to expand capacity further, Mr Lheem said.

According to Mr Lheem, there is scope for adding capacity for another 100,000 cars — incidentally, the capacity with which Hyundai began its show in India 10 years ago — by putting up a body shop and a paint shop in the vacant space behind the Plant-II.

The existing assembly line will be able to handle the additional volumes.

Growing sales

What has made Hyundai India optimistic is the firm trend in sales growth, which has been outpacing the market by a wide margin.

For example, in the first two months of the current financial year, Hyundai’s sales grew 49 per cent, while the market grew 22 per cent.

In the April-June quarter, Hyundai sold 120,444 cars, both in India and abroad – 48 per cent more than it did in the same period last year.

Exports up

Exports during the period (52,552 cars) were up 60 per cent.

Mr Lheem says the firm trend in exports will continue, even though Hyundai is building plants elsewhere in the world.

In June, it broke ground for a new plant in St Petersburg, Russia, and its Czech plant will commence production in January.

However, since Chennai has been named as the global manufacturing hub for small cars (Santro, Getz, i10), exports out of India will only rise, not decline.

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