Kia Motors plans to invest $2 billion (Rs 12,750 crore) in India over the next two years to set up a manufacturing plant and develop a supplier base, a top executive said. The affiliate of South Korea’s Hyundai Motor expects its investment to create 3,000-4,000 jobs here in the next five years.
Kia in April announced that it would invest $1.1 billion to build a factory in Andhra Pradesh’s Anantapur district. The additional investment will be to create the supplier base, said Tae-Hyun Oh, the Chief Operating Officer of its international business division. Marketing budget will be outside of this, he said.
Kia’s plant is set to become operational in 2019. The company is aiming to be among the top five carmakers in the country by 2022. By that time, it is targeting to sell 3 lakh units a year, which will also be the plant’s optimal capacity.
Kia, which has operations in 180 nations, was absent from just two important markets until recently — Mexico and India. It started operations in the North American country last year and is now all set to roll out its first product from India by in the second half of 2019.
India is a key market for global automobile companies, as it is among a few that are still growing at a fast clip. Though only a handful of the nearly two dozen car manufacturers operating in India has achieved meaningful success, Hyundai has seen strong growth from the time it entered India. The performance of the group company has encouraged Kia to target large volumes here.