Kia forays into India, first plant to come up in Andhra

Lynne Hanson
April 28, 2017

After a series of speculations regarding its plans to enter the Indian auto market, Kia Motors has now officially announced its India entry.

Kia plans to commence local sales of cars produced at the new facility towards the end of 2019, once mass production begins in Anantapur. Faced with numerous challenges onwards, Kia Motors plans to sales in upcoming quarters by focusing on emerging markets and marketing new models.

The work on the plant would commence in September and the production of cars would start in the second half of 2019, he said. Kia Motors is going to setting up a factory with annual capacity of 3,00,000 units with an investment of around 10000 Crore. The compact sedan segment has witnessed a decline in sales-automakers such as Maruti Suzuki India Ltd and Hyundai Motor India Ltd are set to introduce new models to reinvigorate sales. As a result, the carmaker will differentiate itself from Hyundai in all major operational procedures - product, advertisement and dealership network.

Kia will invest $1.1 billion in its manufacturing plant in India.

Kia Motors' new factory will be spread over 536 acres (2.16 sq. kms) and will have a manufacturing operation that incorporates stamping, welding, painting and final assembly facilities.

The Kia Sportage is a popular crossover model in the global market.

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Global ratings agency Moody's Investors Service said Thursday it will maintain the current Baa1 rating for Hyundai Motor Co., South Korea's top automaker, despite its weak first-quarter earnings.

"Through the construction of a factory in India, Kia Motors will pioneer India's auto market, which is under the spotlight as the next growth market".

"Kia will be a strong new force in the Indian automobile market".

More than three million passenger vehicles were sold in India in the financial year ended March 31, almost 10% more than the previous year, according to the Society of Indian Automobile Manufacturers.

Russia, Brazil and India were the bright spots for Hyundai in the first quarter, registering sales increases on the back of demand for the Creta SUV.

Other reports by TheDailyFarc

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