The Tamil Nadu government has undertaken efforts to woo the Seoul-based automobile manufacturer Kia Motors-the second largest carmaker in South Korea, where the country's leading automobile giant Hyundai holds a 33% stake.
The TN government offered almost 400 acres of land for the Korean carmaker to set up its plant in Tamil Nadu, India. "After visiting Tamil Nadu, they asked us about 400 acres of land, and we have offered about 390 acres. I am hopeful that they will set up factory in Tamil Nadu," said the Industries Minister, M.C. Sampath, in a State Assembly session.
Andhra Pradesh had been considered the closest second to Tamil Nadu by the Korean automaker, since the Hyundai's Sriperumbudur plant is just 80 km away from Andhra Pradesh.
The time is ripe for Kia Motors to firm up its plans to setup a plant in India. The company had already planned to set up a facility by August 2016 in India. With production beginning from 2019, Kia Motors will aim at an eventual capacity of 300,000 vehicles per annum.
Both the Hyundai and Kia share components and underpinnings and float similar models in the market. Hyundai will also look at strategic benefits for both itself and Kia by bringing the Kia close to its two facilities in Chennai, where it produces a combined 680,000 vehicles per annum.
Andhra Pradesh, Maharashtra and Gujarat have also been trying to woo Kia Motors but for now it seems that Tamil Nadu and Andhra Pradesh are the front runners. Kia Motors is likely to invest Rs. 5,000 crore for setting up its manufacturing facility with an annual capacity of 300,000 vehicles per annum.