Hyundai eyes expansion in region ahead of AFTA

Hyundai eyes expansion in region ahead of AFTA

KUALA LUMPUR (AFP): South Korean carmaker Hyundai Motor Co. Thursday unveiled plans to expand in Southeast Asia to take advantage of the planned opening in 2003 of a regional free trade area.

Hyundai's vehicles are now locally assembled in Malaysia and Indonesia and the company wants to venture into the Philippines and Thailand, said Hyundai Motor director Um Kwang Heum.

It aims this year to sell 30,000 cars in Asia excluding India and China, he said after launching the first Hyundai Elantra model fully assembled in Malaysia.

"Apart from Malaysia, we have another CKD (completely knocked down) plant in Indonesia. We are considering another smaller CKD project in the Philippines and possibly later on in Thailand," he told a press conference.

Hyundai's director for Asia operations, Kim Kwan Jong, told AFP that the company was reviewing its marketing strategy to benefit from the ASEAN Free Trade Area (AFTA).

Indonesia is the company's biggest market in the Association of Southeast Asian Nations (ASEAN), but Kim said Hyundai has been unable to invest in the region as much as its Japanese rivals due to financial problems in South Korea.

Under AFTA, tariffs among the most developed ASEAN members are due to fall to below five percent at the start of 2003. Malaysia has obtained a two-year reprieve for its fledgling auto industry.

This year, Kim said Hyundai projected global sales to rise to 1.7 million units, up from 1.4 million last year. It forecast a global turnover of US$19 billion this year, about 30 percent higher than 2000.