Hyundai Motor is actively considering plans for a car plant in the US, according to industry sources.

The news comes as Kim Dong-Jin, president of Hyundai Motor, is set to visit Washington DC to discuss Hyundai's future expansion plans.

The plans for a manufacturing presence in the US echo the history of the Japanese makers in North America in the 1980s: growing autos trade imbalance, followed by political tensions and then plans to manufacture in the US.

Hyundai sales in the US market are low at the moment - under 3% of the light vehicle market - but are growing strongly. As they grow in the medium term, the trade imbalance and friction will likely worsen, so setting up a plant to come on stream in four years time actually sounds quite prudent.

The company has been working to raise its image and average unit price in the US market and is enjoying some success.

But Hyundai's history in the US is chequered.

In the 1980s, Hyundai entered the US market with disastrous consequences. Sales rose rapidly from a standing start, but the low-price vehicles had severe quality problems and the reputation of the brand was compromised. A Hyundai production plant in Bromont, Canada, turned out to be an expensive waste of money as sales dried up and was eventually mothballed prior to total shutdown.


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