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Hyundai has shifted production of models for Europe to plants in Turkey and Czech Republic. Photo: HT
Hyundai has shifted production of models for Europe to plants in Turkey and Czech Republic. Photo: HT

Hyundai stops car exports to Europe from India

The move will result in around 25% reduction in overseas shipments from the company's Chennai plant

New Delhi: India’s largest car exporter Hyundai Motor Co. has stopped shipments from its Chennai plant to Europe after shifting production of models for the continent to plants in Turkey and Czech Republic.

The move will result in around 25% reduction in overseas shipments from the company’s Chennai plant this year at 1.9 lakh units, compared to 2.53 lakh units last year. The company’s Indian arm Hyundai Motor India Ltd (HMIL) will now focus on Latin America, Middle East, Australia and Asia apart from the domestic market. “It has been about a month that we have stopped serving Europe, which will now be served by Hyundai plants in Turkey and Czech Republic," Rakesh Srivastava, senior vice-president, sales and marketing, Hyundai Motor India, said. Europe has been one of the largest markets for Hyundai Motor India, the largest exporter of cars from India. Last year, the block accounted for 40% of its exports from the Chennai plant, which can roll out 6.8 lakh units annually.

Srivastava said the step was taken up considering the need for immediate capacity at the Chennai to serve the requirement of the Indian market. Hyundai Motor India’s capacity utilisation of the Chennai plant was 98.5% last year. “In the last one year, we launched four brands in India. Therefore, we needed to create capacity. Our priority is the domestic market. So when the Turkey plant became ready, Hyundai decided to move export of European model of i20 there. Going forward, all the European models of i20 and i10 will be served from Turkey and the Czech Republic," he said. The company’s latest model Elite i20 will be produced in Turkey for the European market.

The company accounted for 45% of the total cars exported from India last year.

Srivastava insisted Hyundai’s Chennai plant will still be a global hub for exports of small cars, as the Korean company had announced in the past.

“India is still a global hub for exports for Hyundai. We will export to Latin America, the Middle East, Australia and Asia from here," he said, adding that the decision to move European production to Turkey and the Czech Republic was taken based on better utilization of the company’s seven plants across the world.

Explaining Hyundai’s decision of not investing in a new plant in India, he said: “To set up fresh capacity you need about 14-18 months."

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