VIJAYAWADA: The Andhra Pradesh government on Thursday inked an MoU with Kia Motors Corp., a unit of South Korean automobile firm Hyundai Motor Co., under which the latter will build a manufacturing facility, its first in India, at Erramanchi in Anantapur district with an investment of $1.1 billion (approximately Rs 7,050 crore)
As per the MoU signed by Han-Woo Park, Kia president, and Solomon Arokiaraj, State industries department secretary, in the presence of chief minister N Chandrababu Naidu at the interim Secretariat near here in Velagapudi, Kia will manufacture compact Sedans and SUVs, marking its entry into the lucrative Indian automobile market.
The Erramanchi unit will incorporate the facilities for stamping, welding, painting and assembly. Besides an advanced training centre, Kia Motors will also establish a township for its employees. The project is expected to generate employment for over 11,000 people, both permanent and temporary. The project is likely to take off in the last quarter of 2017 and is expected to roll out the first batch of cars in the second half of 2019, to eventually produce up to 300,000 units each year.
“I am very happy that Kia Motors has selected Andhra Pradesh to set up their new plant,” Naidu said at a press conference, adding that he had persuaded the company to push the deadline for trial production from June 2019 to December 2018.
Naidu said he wanted at least 2 lakh jobs to be created in the automobile and auto components sector in AP by 2020.
The government believes that with the presence of Kia Motors and its ancillaries, the entire region from Anantapur towards Bengaluru will be developed into a strong economic hub. Besides, the project could have a spin-off effect on industrial development and employment in backward areas within Andhra Pradesh.
Naidu said he would personally monitor the progress of the project every fourth Monday and appointed the District Collector of Anantapur as the nodal officer for this project.