April 27, 2024

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[THE INVESTOR] Hyundai Motor is building an assembly plant in Vietnam to beef up production of commercial vehicles in one of the fastest growing markets in the world, according to Yonhap News Agency on Feb. 7.

Hyundai and its Vietnamese partner Thanh Cong Auto have set up a 50:50 joint venture to construct an auto plant in Quang Nam province, with plans to roll out 20,000 units of truck and buses annually. The construction of the plant will be completed by July. 

Hyundai vehicles are parked at a port to be shipped to overseas markets.

When adding the production from Thanh Cong’s existing facilities in the province, Hyundai’s production of commercial vehicles will reach 30,000 units annually.

According to sources, Hyundai has invested some US$100 million to set up the JV to expand production in the country, as part of its strategy to tap into the Southeast Asia region. Before the establishment of the JV, Thaco was solely in charge of assembling and producing Hyundai’s commercial vehicles in the country.

While Vietnam’s auto market is relatively small in the Southeast Asia region, the market is growing at the fastest rate. Last year, Hyundai became the top seller in 2.5-ton or higher truck and bus segment, making up more than 25 percent of the Vietnamese market.

In 2016, Hyundai sold 112,332 commercial vehicles in the country, up 23 percent from the previous year. Through the planned facility expansion, Hyundai aims to keep up with the growing demand for commercial vehicles in the country.

By Ahn Sung-mi (sahn@heraldcorp.com)