Kia breaks ground for new plant in China

By Kim Tae-jong

The nation’s second-largest automaker Kia Motors said Friday it had broken ground for its third plant in China.

According to the automaker, the new plant will be located in the northeastern city of Yancheng in Jiangsu Province and will be completed in 2014 to better meet increasing demand in the world's fastest-growing car market.

The plant with an annual production capacity of 300,000 cars will mainly produce small vehicles designed for the China market.

Hyundai Motor Group Chairman Chung Mong-koo said the plant will help Kia boost its total annual production in China to 750,000 and consequently increase its market share.

“With this third plant in China, a total of 750,000 cars will be produced annually,” Chung said Friday during the ground-breaking ceremony for the plant. “The auto market is fast growing in tune with economic growth here in China. We decided to construct the plant to meet increasing local demand.”

The ceremony was attended by Chinese government officials as well as Kia employees and officials, including Secretary of Jiangsu Province Luo Zhijun and Secretary of Jiangsu Vice-governor Shi Heping.

The chairman also said the third plant in China will help the automaker make further progress on the quality front as well as increase overall customer satisfaction, emphasizing China is becoming the most important market for Hyundai Motor and Kia Motors.

Kia officials said the new plant will have synergy with the first and second plants located in the Yancheng Economic Development Zone, which have a combined production capacity of 440,000 annually, especially as it is just 5 kilometers away from the first plant, meaning the new plant can use much of the existing infrastructure.

Kia, an affiliate of Korea’s largest automaker Hyundai Motor, sold 432,518 vehicles in China last year and plans to sell 460,000 this year.

With the construction of new plants in China, Hyundai and Kia, which together form the world's fifth-largest car-making group by sales, aims at overtaking General Motors in sales in the country.

Currently, Volkswagen maintains the No. 1 position in the Chinese market, followed by GM and Hyundai Motor-Kia Motors. They sold 2.2 million, 1.32 million and 1.17 million last year.