According to reports by Reuters, Kia Motors is planning to build its first-ever auto manufacturing plant in metropolitan Monterrey, Nuevo León. The plant, with a capacity of 300,000 cars per year, is intended to augment Kia’s sole US plant, located in Georgia. Months ago, word was leaked that Kia was conducting feasibility analyses looking at different markets. Kia’s announcement differs from fellow Korean Manufacturer Hyundai, which chose to build its new plant in China. Hyundai owns slightly more than 33% of Kia and shares the same chairman but separate management.
While company spokesmen refuse to confirm the decision, they admit that they are considering options to alleviate capacity issues, as their US factory is operating at 100% capacity. Chairman of both Hyundai and Kia Mong-Koo Chung has taken a conservative approach to expansion, hoping to avoid the quality problems Toyota has faced recently, that industry analysts blame on over-aggressive growth.
Though the Monterrey auto plant has not broken ground yet, internal sources indicated that it would take 21 months from the start of construction until production commences.