Beijing Hyundai puts Chongqing plant up for sale

Hyundai

22/08/2023 12:06

BEIJING, Aug 22 (Reuters) - Beijing Hyundai Motor has
put its Chongqing plant up for sale at a starting price of 3.68
billion yuan ($505 million), as the South Korean automaker
rejigs its strategy in China amid fierce price competition and
slowing demand.
    Beijing Hyundai is selling the land use rights, equipment
and other facilities belonging to its plant in the southwestern
Chinese city of Chongqing, according to a disclosure on the
China Beijing Equity Exchange that was published on Aug. 11.
    The Chongqing plant, a joint venture with Beijing Automotive
Group Co, started production in 2017 with an annual production
capacity of 300,000 units.
    "Hyundai Motor has been pursuing various measures to improve
sales performance in China. We plan to strengthen our efforts to
improve profitability through optimising operation of our
production lineups," a Hyundai Motor spokesperson told Reuters
on Tuesday.
    "As of now, buyers and schedule have not been decided," said
the spokesperson.
    The sale came after Hyundai said in June that it would
further restructure its China business to focus on
profitability.
    Hyundai had five plants in China at its peak and sold one of
them in 2021. It plans to eventually operate just two where it
will optimize production and use for exports to emerging
markets.
    Hyundai and its affiliate Kia have seen their vehicle sales
in China plunge over the past few years amid a shift to electric
vehicles in the world’s largest auto market.
    Tesla was the only foreign brand to increase its market
share in China in the first half, according to Chinese industry
data. 
    China's passenger vehicle sales contracted for a second
month in July, as the continuation of a price war and piecemeal
government measures failed to incentive consumers.
    ($1 = 7.2942 Chinese yuan renminbi)

 (Reporting by Qiaoyi Li, Zhang Yan and Brenda Goh; Additional
reporting by Heekyoung Yang)
 ((qiaoyi.li@thomsonreuters.com;))