Hyundai Motor has signed an agreement to establish a joint venture company with China’s Sichuan Nanjun Automobile Group (Nanjun Auto) to enter the world’s biggest commercial vehicle market.
Hyundai Motor and Nanjun Auto, which signed a Memorandum of Understanding (MOU) on the 50-50 joint venture last October, will make a total investment of KRW600bn. The joint venture, Sichuan Hyundai, will be established later this year in Ziyang City, Sichuan Province. While utilizing Nanjun Auto’s existing facilities in the beginning, Sichuan Hyundai will aggressively invest in adding to and improving its facilities. The completion of a new plant will enable Sichuan Hyundai to annually roll out up to 160,000 units (150,000 trucks and 100,000 buses) starting from 2013.
Go deeper with GlobalData
Sichuan Hyundai will carry out a strategy of operating two differentiated brands to efficiently penetrate the market. It will improve Nanjun Auto’s existing models to cater to value-for-money consumers, while launching new Hyundai models as a high-end brand.
Hyundai is confident it can swiftly secure a leading position in the Chinese commercial vehicle market by utilising experience from its passenger car joint venture, Beijing Hyundai Motor.
China’s commercial vehicle market is expected to surge from 4.3m units in 2010 to 5.2m in 2015 due to strong demand, as industrialisation especially in the western regions progresses rapidly. Hyundai aims to sell 73,000 commercial vehicles in China this year, expanding to 160,000 units around 2015 with a market share of 3%.
Established in 1998, Sichuan Nanjun Automobile Group isChina’s 11th largest commercial vehicle maker, operating two plants in Chengdu and Ziyang City with an annual capacity of 120,000 units.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData
