SEOUL, Feb. 16 (Korea Bizwire) – Hyundai Motor Co., South Korea’s top automaker, said Monday it will invest 2 trillion won (US$1.8 billion) over the next six years to beef up its commercial vehicle production and related research to develop new cars and engines.
The investment to be completed by 2020 will be focused on a plant in Jeonju, some 240 kilometers south of Seoul, where Hyundai Motor produces commercial vehicles such as trucks and buses, according to the automaker.
“By establishing a global R&D structure through cooperation with world-class research capacity in the passenger vehicle sector and making aggressive investment to develop new cars and engines that will meet different regional demand, we will push to emerge as a global maker in the commercial vehicle area,” the company said.
Hyundai Motor said it will spend 400 billion won in expanding production capacity at the plant, while setting aside 1.6 trillion won on R&D efforts. It will also hire 1,000 new workers to increase production.
Under the plan, Hyundai Motor aims to raise the plant’s production capacity “in phases” to 100,000 units by 2020 from 65,000 last year. The plant will have new production lines that churn out vehicles targeting advanced and emerging markets, including the United States and Europe.
The move comes as the global commercial vehicle market is expected to expand 27 percent until 2020 when the worldwide demand for trucks and buses is estimated to be around 3.96 million units.
Hyundai Motor, along with its smaller affiliate Kia Motors Corp. is the world’s fifth-largest automaker but lags behind other global rivals in the commercial vehicle market. Hyundai Motor’s market share in the sector stood at 2.1 percent.
Earlier this year, Hyundai Motor Group, which owns Hyundai Motor and Kia Motors, announced it would spend about 81 trillion won by 2018 mostly to improve its facilities and secure core technologies.