Thanh Cong Group will join hands with South Korean Hyundai Motor Group to expand production and assemble Hyundai passenger cars in Viet Nam.
The expansion was under an agreement inked by representatives of the two sides in Ha Noi on Thursday.
Huyndai Thanh Cong, a subsidiary of Thanh Cong Group, has assembled and distributed different types of Hyundai passenger cars for eight years. In the last two years, the company’s passenger cars occupied 18 per cent of the Vietnamese market share. It also won the Distributor of the Year awards from the Hyundai Motor Group in 2014 and 2015.
The move is part of the Hyundai Motor Group’s strategy of expanding production globally. ASEAN is seen as an important market with high potential as head towards 2018 when the import tax of complete built up units within ASEAN bloc becomes zero per cent, under the ASEAN Free Trade Agreement.
In the first phase, the joint venture will continue operating the current Hyundai Thanh Cong in the northern province of Ninh Binh with the capacity of 40,000 passenger cars per year and begin investing in expanding and upgrading the factory.
The factory will be equipped with advanced technology, with almost all production steps using automatic and semi-automatic robots, ensuring all vehicles are of the same quality and follow the Hyundai Motor Group’s standards.
With this expansion project, the number of Hyundai vehicles assembled in Viet Nam, including Hyundai SantaFe and Hyundai Elantra, is expected to increase from the current 20 per cent to 70-80 per cent this year and to 90 per cent in 2018.
Addressing the signing ceremony, Le Ngoc Duc, general director of Hyundai Thanh Cong, said to reach 40 per cent of localisation rate in Viet Nam, the company would co-operate with many domestic and foreign businesses, especially those from South Korea.
In the future, the factory will not only meet the domestic market’s demand, but also export products to ASEAN countries, said Duc.
Vice Chairman of Hyundai Motor Byung Kwon Rhim said the firm would supply the newest and best quality products to satisfy Vietnamese customers. — VNS