South Korea’s Hyundai Motor Group, the world’s fifth-biggest carmaker, which includes affiliates Hyundai and Kia, has announced it will move to invest $73 billion over the next four years.
The auto making group, the largest in South Korea, has decided to use the money to increase production capacity, build its new (and controversial) headquarters and develop and produce new models. The country’s second-largest business conglomerate has introduced the investment strategy just as the government of President Park Geun-hye has called for local companies to use more of their huge cash reserves to spur investment, employment and dividend payments. The Group, which includes carmakers Hyundai and Kia has a total of 57 affiliates and said it would use 49.1 trillion won on capital investment and another 31.6 trillion won on research and development by 2018.
The investment plan has not been detailed yet, but coupled with the latest announcements from both Hyundai and Kia, it looks like the automaker is ready to resume capacity expansion after an unofficial moratorium on new plants to focus on quality. Recently, both Hyundai and Kia said they would construct new plants in Mexico and China during the next few years. Hyundai Motor and Kia Motors added they would massively increase spending on development of new models, including eco-friendly vehicles and self-driving cars over the next four years. Additionally, the Hyundai motor Group added that most of the investment – tallying around three-quarters – would be used internally in South Korea, in a drive to “greatly contribute” to the local economy development.