Hyundai Motor Co., South Korea's largest automaker, plans to hold a ceremony to start its delayed $1 bln (€770 million) factory in the Czech Republic in April.
Hyundai Motor affiliate Kia Motors Corp. will celebrate the completion of its Slovakia plant several days earlier, Hyundai Motor spokesman Jake Jang said today in Seoul by phone. The Czech plant was delayed by the trial of Hyundai Motor Chairman Chung Mong Koo, as it restricted his travel. Chung was sentenced to three years in prison this week for embezzling funds as well as breach of trust. The automakers are expanding overseas to hedge against currency fluctuations and overcome trade barriers. „The company wants to show its operation is on track even after the chairman's conviction,” said Kim Min Jeong, who helps manage $4.6 billion in equity assets at SH Asset Management Co. in Seoul as an analyst. It's not certain whether Chung will attend the ceremonies, Jang said. The chairman is free on bail while he appeals his sentence. Hyundai Motor and the Czech government signed an agreement in May last year to build a 300,000 unit-a-year factory in Nosoviche, an industrial area 320 kilometers (200 miles) east of Prague. The automakers are trying to recover from falling profits as an 8.6% gain in the won against the dollar last year hurt their competitiveness against Japan's Honda Motor Co. and Toyota Motor Corp. Shares of Hyundai Motor dropped 1.3% to 68,000 won at 11:30 a.m. in Seoul while Kia Motors shares gained 1.7% to 12,300 won. The benchmark Kospi index little changed. (Bloomberg)