Renault Korea Motors plans to invest KRW700m (US$523m) by 2027 to introduce new eco friendly models at its Busan plant as it continues to struggle with plunging sales.

The company, majority owned by Renault SA, signed a memorandum of understanding (MoU) this week with the city government agreeing to transform its Busan plant into a global production hub for hybrids.

The company reported a 37% drop in global sales to 106,924 vehicles in 2023 with domestic sales plunging 53% to to 24,696 units and exports off 30% at 82,228 units.

The XM3 was by far the best selling model with 78,000 global deliveries, followed by the QM6 and SM6. The plant has capacity for 300,000 vehicles.

Renault Korea CEO Stephane Deblaise said the company planned to build hybrid vehicle research and development (R&D) and production facilities at Busan as part of its previously announced Aurora project.

The company also said it was considering doubling its announced investment to KRW1.5trn to build facilities for BEVs at Busan, pending approval from France.

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Just Auto reported previously Renault Korea had agreed to produce a Geely based hybrid SUV at Busan later this year under the Aurora programme to help revive its sales, to be followed by a Polestar 4 based BEV in the second half of 2025.