• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

Commits additional investment of Rs 3,220 crore in TN

Chennai , Sept. 18

Hyundai Motor Company has said that it will roll out a new compact car `in addition to Santro' from its subsidiary Hyundai Motor India's plant at Irungattukottai, near here. The car will be produced from Hyundai Motor India's second plant, now under construction and is expected to be completed in October 2007, according to a company press release.

Construction on the second plant, with a capacity of three lakh units, is in progress. The second plant will take Hyundai Motor India's capacity to six lakh units a year, about half of which will be exported.

Mr Chung Mong Koo, Chairman, Hyundai Motor Company, who met the Tamil Nadu Chief Minister, Mr M. Karunanidhi, on Monday, also committed additional investments in the State.

According to reliable sources, the Hyundai Chairman committed an additional investment of $700 million (about Rs 3,220 crore) in Tamil Nadu, which will cover the second plant and also an engine and transmission facility. Besides, Hyundai's vendors are expected to invest another $200 million (about Rs 920 crore), according to the sources. At least 20 of Hyundai's vendors are expected to set up plants here.

Hyundai Mobis, a leading auto parts company and part of the Hyundai group, is setting up a plant at Irungattukottai. Hyundai Mobis, which is also the largest shareholder of the Hyundai-Kia Automotive Group (according to information on the Internet), hopes to build its plant in India by June 2007. Hyundai Mobis is into module systems, braking systems, car audio and navigation systems and a wide range of low-end automobile components.

The Hyundai press release said that Mr Chung sought the State Government's support in improving infrastructure such as roads, railways and setting up of a new port facility exclusively for car exports.

During his visit to Hyundai Motor India's plant, he asked the workers to ensure timely completion of the second plant and achieve global top-tier quality in the products. The Indian auto market, he told the workers, was poised for a major growth in the next decade and Hyundai Motor India must be ready to meet the rapidly growing demands of the market. The second plant would help the company export 3,00,000 units a year.

According to reliable sources, the company is discussing with the Government the possibility of getting sales tax and other financial incentives for its second plant also. In the agreement it signed with the State for its first plant, the company was assured of some incentives, including sales tax deferral or waiver.

The State has issued an order on August 28, 2006 exempting Hyundai Motor India from paying additional sales tax on the cars and components manufactured and sold by it. This was one of the long pending demands of Hyundai Motor India and the Government Order gives the company the exemption from October 1, 1998 to September 30, 2012 (the period for which the fiscal incentives were agreed upon).

More Stories on : Outlook | Strategy | Cars | Tamil Nadu

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
McLeod Russel to raise up to $30 m through QIP

Copyright © 2006, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line