By IANS
Chennai : India’s second largest car manufacturer Hyundai Motor India Ltd. is in talks with the Tamil Nadu government for getting investment concessions.
Earlier this year, the state government announced its Ultra Mega Integrated Automobile Projects policy.
Under the policy, vehicle manufacturers investing over Rs.40 billion over a period of seven years from the date they sign a Memorandum of Understanding (MOU) with the Tamil Nadu government or any other date specified by the government are eligible for incentives.
The incentives are: land at concessional rates, stamp duty exemption, dual feeder lines for power supply, exemption from electricity tax for 10 years and refund of gross output value added tax and Central sales tax for 21 years or up to 115 percent of eligible investment.
The Indian subsidiary of the Korean carmaker is investing around Rs.60 billion in expanding its capacity by another 350,000 units and is also setting up an engine and transmission plant of similar capacity at its existing location near Chennai.
Heung Soo Lheem, managing director and chief executive officer, told reporters Thursday that the expansion project is eligible for incentives under the government’s policy and talks are on with the officials in this regard.
He said the company plans to roll out 530,000 units in 2008, out of which 40 percent will be of its new compact car i10.
The new car will be exported to around 70 countries but the major market for the car would be Europe. The current export order book position for i10 is 9,700 units.
Speaking about export targets for the next year, Lheem said 50 percent of next year’s production would be exported. This year, Hyundai plans to roll out 15,000 units of the i10.