Hyundai Motor broke ground on its second vehicle assembly plant in Vietnam this week, according to local reports, as the carmaker looks to strengthen its presence in one of south east Asia's most promising markets.
The new plant, located in Gian Khau, Ninh Bin province, is a joint venture between Hyundai Motor and local conglomerate Thanh Cong Group called Hyundai Motor and Thanh Cong Group. The two partners will invest a combined VND3.2trn (US$140m) to complete the first phase of the project by June 2022, with the second phase scheduled for completion in 2025.
The new plant, when completed, will have an annual production capacity of 100,000 units, lifting Hyundai-Thanh Cong's total production capacity to 170,000 units per year.
The current plant mainly produces commercial vehicles, including the Mighty medium-duty truck, with sales amounting to just 1,845 units in the first eight months of 2020. The second plant is expected to focus on passenger vehicles.
Hyundai sister company Kia Motors has a more prolific partnership in Vietnam with the local Truong Hai Auto Corporation (Thaco), with sales of its K-series trucks amounting to 8,263 units year to date.
Total vehicle sales in Vietnam declined by 24% to just under 146,000 units in the first eight months of the year due to the COVID-19 pandemic, according to the Vietnam Automobile Manufacturers Association.