Taking Steps to Exit China
Hyundai Motor will relocate the production facilities of its Beijing Factory 1 to Indonesia.
For the factory relocation, Hyundai Motor set up a task force early this year. The team has reportedly been working with major logistics companies in Indonesia since March this year to set up transportation plans to move facilities from Beijing Factory 1 to Indonesia.
First of all, Hyundai Motor will take apart old facilities in China, upgrade them through an overhaul, and move them by ship. Some facilities will be directly relocated from China to Indonesia, while others will be transported to Indonesia via Korea. This will mark the first time that Hyundai Motor’s overseas production facilities are relocated to another country through a massive transportation operation.
A list of used factory facilities has been made. The list includes 13 core production facilities at Beijing Factory 1. Hyundai Motor will relocate major facilities in the coating section, workshops, transportation facilities and robots from China to Indonesia directly, while press facilities including de-stackers, transfer robots, end conveyors and plano millers and conveyors will be exported to Indonesia through Korea. All of them are essential equipment for factory operations. Experts speculated that the facilities were classified in accordance with overhaul difficulty.
Hyundai Motor closed its Beijing Factory 1 last month, but has yet to disclose a specific utilization plan for the plant site. Experts believe that the site will be leased on a long-term basis like Kia Motors' Yancheng Factory 1.
Indonesia is considered one of the leading candidates for Hyundai Motor’s production base in Southeast Asia. After the relocation of the Beijing factory to Indonesia, Hyundai Motor is expected to step up efforts to penetrate the Southeast Asian market.