South Korean car maker opens first assembly plant in Myanmar

As the government is pushing for car companies to assemble their vehicles in Myanmar, more international companies are setting up assembly plants in the country.

Among the latest is South Korea’s Hyundai. The company launched its plant and its first semi-knocked-down (SKD) model on February 8.

The local arm of Hyundai, Shwe Daehan Motorcar Assembly Co, will be the entity responsible for assembling Hyundai vehicles locally. International KLM Co is the authorised importer and dealer for Hyundai and has been operating since 2014. Now, KLM will also distribute locally assembled Hyundai cars from the Shwe Daehan factory.

The factory is situated in the Thardukan industrial zone of Shwe Pyi Thar Township and employs nearly 200 local workers.

“This is the next step for Hyundai Myanmar. I hope that Hyundai can produce completely built up (CBU) cars in Myanmar one day, just as is done in South Korea. The cars assembled in this plant will be allowed to carry Yangon licence plates,” said Yangon Chief Minister U Phyo Min Thein during the launch of the factory.

The first model from the plant is the all new Accent sedan with a 1.4 litre four-cylinder engine. The company is offering a 100,000 kilometre or three-year warranty for the model that is priced at K29.9 million before taxes.

“Planning for the Shwe Daehan assembley plant began last year and it became operational this January. We will continue to import CBU Hyundai cars besides selling the SKD cars assembled by the plant because there are buyers who prefer cheaper models with Yangon licence plates,” said International KLM’s sales and marketing manager U Myo Win.

According to the Ministry of Industry, the factory has a permit to assemble 40 units per month, but the factory will assemble units based on customer demand with the ministry’s permission should demand increase.

“Now, we are currently studying the market sentiment so we do not have an exact target for production numbers yet as this depends on market demand,” said U Myo Win.

Hyundai Motor Co Vice President Mr Jeong Bang Sun said that the company hopes to produce 10,000 SKD cars in Myanmar this year.

After the Accent, the factory will begin assembling the Creta sport utility vehicle. The company is currently accepting preorders for the Accent.

The factory has already assembled 100 units of the Accent and the company has received about 30 preorder. Besides the Accent and Creta, Hyndai representatives say other popular models will be assembled later on.

“Based on market demand, we are starting with the Accent and we will produce another models such as the Creta,” said U Yu Ko, dealer and stock management manager for the assembly plant.

Suzuki, Nisan, KIA, Ford, Lifan and Soueast are all currently selling SKD cars in Myanmar.

Starting from 2016, the Yangon Region government suspended issuing Yangon licence plates to fully imported vehicles as part of efforts to control the number of vehicles and reduce congestion in the city.

However, an exception is being made more locally assembled vehicles, and foreign car companies have been setting up assembly plants since then.

South Korean Ambassador to Myanmar Mr Lee Sang Hwa said: “The setting up of the plant is a symbol of the good relations between South Korea and Myanmar, and Hyundai is happy to be contributing to the growth of Myanmar.”

Source: Myanmar Times

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