Hyundai to invest Rs 1,500 cr in diesel unit near Chennai

Hyundai Motor has confirmed additional investment of Rs 1500 crore for a diesel plant near Chennai, setting at rest speculation over whether it would set up a plant outside Tamil Nadu.

"The company has informed the Tamil Nadu government that it has proposed to invest Rs 1,500 crore in Tamil Nadu for its diesel plant and an MoU in this regard is expected to be signed soon. On January 13, they formally applied to us," Industry Department Principal Secretary Rajeev Ranjanhe told reporters here.

The South Korean automajor has been scouting for land across India for the plant and various reports said company executives had met top government officials of Gujarat and Chandigarh in this regard.

Asked about these reports, Ranjan said, "there may be lot of talks. I have to say they (Hyundai) are happy here."

Ranjan said the investments will be mainly for the diesel plant and auto component manufacturing facility.

Company sources said the diesel plant capacity is likely to be around 1.5 lakh units per year.

Asked about the location of the plant, Ranjan said it may be at the existing facility at Sriperumbudur near Chennai.

"You know they are having good space in the present facility itself. It (Diesel plant) should come up there itself," Rajan said.

He said Hyundai Motor India would soon sign an agreement with the Tamil Nadu Government for the diesel plant.

Hyundai Motor India entered India in 1996 with an investment of $740 million to set up base at nearby Sriperumbudur. At present, it has two manufacturing facilities with a capacity of six lakh units every year.