April 23, 2024

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[THE INVESTOR] Kia Motors , Korea’s second largest carmaker, has decided to inject 725.9 billion won (US$649.55 million) to establish a new unit in India and accelerate the construction of its first auto plant in the country. 

The carmaker said on July 27 it has established Kia Motors India by purchasing the entire 41.69 million shares of the new unit. 

The first installment of the investment will be made sometime this year, followed by a series of payments depending on the construction schedule. 

In April, Kia announced it will invest US$1.1 billion to build the first Indian plant in Andhra Pradesh state with an annual capacity of 300,000 units. It plans to start producing cars in the second half of 2019, focusing on strategic mini-sedan and compact SUV for Indian customers. 

Kia CEO Park Han-woo in June said the carmaker is laying the groundwork for the site and plans to kick off construction by the year-end. 

Kia is also firming up its sales strategy ahead of the India debut. Kia will host a series of roadshows in August-September across major Indian cities to meet prospective dealer partners, who will learn about Kia’s business strategy, sales network and products that will sell in the country, according to sources.

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