Expansion of Production in US
Hyundai Motor will expand its Alabama plant by investing about 300 billion won (US$270 million) in the second half of next year. The investment aims to overcome its sluggish US sales by producing sports utility vehicles (SUVs) which are in increasing demand.
According to the automobile industry on November 9, Hyundai Motor made a decision to expand its Alabama plant as early as the second half of 2018 with the aim of producing the mid-sized SUV Tucson in the US.
Hyundai Motor began expanding its Alabama plant in five years since 2013. This means the start of chairman Chung Mong-koo’s plan to invest US$ 3.1 billion in the US for the next five years. It attracts a lot of attention whether or not the decision will affect the renegotiation of the Korea-US Free Trade Agreement (FTA) that will start before long.
Currently, the Alabama plant produces three models -- the Sonata, the Elantra and the Santa Fe. Tucson exports to the US ran to at 79,713 units last year, following the three models rolled out from the Alabama plant. Hyundai Motor is planning to produce most of cars to be sold in the US at its US plant. The expansion of the plant is expected to lead to a production increase of about 80,000 units. It is estimated that about 300 billion won will be invested in the plant expansion.