Hyundai Motor is considering a new diesel engine plant in India using locally-sourced components to consolidate its position as the country’s largest exporter of passenger cars.

“We concluded a feasibility study on a new diesel engine plant in India around three months ago. I think, a decision on that will be taken soon at our global headquarters after due consultations with our executives in India,” a senior official said in Seoul.

“It would cost around $550m to set up a diesel engine plant with an annual capacity of 300,000 units,” the official said on condition of anonymity. “We initially want to localise some critical engine components in India. Once that is done making other components like cylinder block heads is not a problem.”

However, Hyundai India said the company had so far made no firm plans and no details of investment, scale or timeline had been announced.

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