Hyundai Motor Company, the $47-billion Korean auto giant, is planning to make its Indian manufacturing plant a global export hub in the next 18 months with an additional investment of $200 million.

As its only production facility outside South Korea, the capacity of its Indian subsidiary will be ramped up to 400,000 units annually for catering to the growing domestic and overseas markets, especially in the US, Europe and South America.

"The parent company has decided to turn the Rs 40-billion (Rs 4000 crore) Hyundai Motor India auto plant near Chennai into a global production base for the compact car segment.

"In the first expansion phase, the capacity will be increased to 250,000 units per annum by 2004 from150,000 units currently to step up our exports of Santro Xing to 70,000 cars next year from 30,000 cars projected for the current fiscal (2003-04)," Hyundai Motor India president B V R Subbu told rediff.com in Bangalore on Monday.

With a cumulative investment of $750 million till date, the Korean subsidiary has already upgraded its Irrungattukottai facility to global standards and benchmarked it with its Korean production base.

"Though Hyundai India has emerged as the second largest carmaker in the country in just 5 years with a leadership position in the B (Santro), C (Accent), and E (Sonata) segments, we are aiming to emerge as the country's largest exporter of compact cars in the next couple of years," Subbu claimed.

The proposed investment of $200 million or Rs 850 crore (Rs 8.50 billion) will go in launching its first sports utility vehicle Terracan later this year, an upgraded version of Accent, and another C model (Getz) by next August, besides expanding capacity for the existing three models.

"Having consolidated our position in the domestic market with a 19 per cent share, we have set our sights on the export market in a big way to double our export revenue to $280 million by 2004 from the estimated earnings of $120 million during the current year," Subbu stated.

India's passenger car exports zoomed to 65,000 last year, with Maruti and Ford India emerging on the top, followed by Hyundai India at 8600 cars, including 6,000 Santros, and 2,600 Accent models.

The Santro models are sold in Europe under the brand names of Atos Prime and Amica. The latest Santro Xing will be replacing the existing models but in another brand name as upgraded versions of the former.

"Our global strategy is to gradually shift the export base from South Korea to India so as to capitalise on shipping costs to Europe and Latin America and reduce delivery cycle times," Subbu affirmed.

In order to achieve a global sales of 5 million cars by the end of the current decade from the current 3 million units to emerge as the world's top five car makers, Hyundai plans to convert its Indian production base as the second largest mid-size car facility though plans are underway to set up a manufacturing facility in the US for large-size cars in the near future.

Asked whether Santro benefited from the withdrawal Daewoo's Matiz in the B segment, Subbu said Santro was already ahead of Matiz and other models in the segment despite stiff competition in a downturn economy.

"We will continue to grow faster than the industry's growth rate. If the Indian economy grows at 6 per cent, the passenger car industry is expected to grow by 10 per cent. We intend to grow by 20 per cent this fiscal year," Subbu asserted.

The company recorded a combined sales of 111,051 units during the calendar year 2002 with leadership position in all the three brands. Till date, Hyundai India sold about 400,000 cars during the last 55 months since it commenced commercial production in October 1998.