HARI to start full Hyundai CKD assembly in June

Hyundai Asia Resources, Inc. (HARI) will start full CKD (completely knocked down) assembly for one model by June this year.

HARI President and CEO Fe PerezAgudo told reporters at the opening of the Manila International Auto Show (MIAS) at the World Trade Center. Agudo said they will first hold a pilot assembly on May 14 for quality test before the full CKD assembly on June 1 this year at its plant in Laguna.Commercial production will commence in September this year.

“By end of the fourth quarter this year, we are looking at 3,000 to 5,000 units for one model only,” said Agudo refusing to say which model they are going to assemble first. It could be recalled that HARI proposed two models — Eon (small car) and H350 (a van model) for local assembly. By the beginning of the fourth year of its operation, the HARI plant should have built a production capacity of 50,000 units.

HARI has earmarked R5 billion for the local assembly operation. Majority of the investments will go into the installation and acquisition of assembly equipment.

“It’s a full production from welding to painting and all. There will be 1,800 big and small parts,” said Agudo.

For its sales, Agudo said they are looking at 10 percent growth or 40,000 units this year from last year’s 37,678 units. The growth projection, however, is subject to recalibration by end of the second quarter. He expressed optimism of growth given the launched of 4 new models.

In the case of the Association of Vehicle Importers and Distributors (AVID) to which Agudo is also president, the group did not set sales growth target for the year as they have yet to assess the short-run impact of the higher excise tax on cars. But Agudo said they expect the luxury car models of their members to be able to adjust shortly. Last year, AVID’s sales reached over 106,286 units, 14 percent higher than the 93,192 units sold in 2016.

It can be recalled that Department of Trade and Industry (DTI) stood firm on its decision in November last year to suspend the registration of HARI under the Motor Vehicle Development Program for six months and comply with the requirements of the program, which include local assembly and commercial operation. (BCM)