Hyundai Motors signed an agreement with Indonesia to establish its first vehicle manufacturing plant in Southeast Asia. The new plant would boost ferrous scrap demand in Indonesia where demand for steel is rising.

 

A Memorandum of Understanding (MoU) was entered by South Korea’s leading auto manufacturer Hyundai Motors to expand in the ASEAN markets to combat slowdown elsewhere in the global auto markets.

 

Hyundai Motor will invest $1.55bn for the plant over a decade. The facility with an initial annual capacity of 150,000 units will be located in eastern Jakarta. The plant is likely to break ground in December this year with commercial productions beginning second half of 2021. The plant’s full capacity would be approximately 250,000 vehicles production per annum.

 

The car plant would boost the scrap demand in the region as it will manufacture tailored vehicles for customers in the South East Asian market with integrated stamping, welding, painting and assembly units. Indonesia is the largest automobile market in the ASEAN region with an annual sales of 1.15mn units last year and is considered a high-growth potential automotive market.

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