Hyundai Kia Motors, Local Production Down 32% from January to April This Year... China Production Halved

Hyundai Kia Motors' Overseas Production Drops 32% Until April
Local Production in China, Brazil, India Plummets Due to COVID-19 Impact
Global Car Plants Gradually Resume Operations from May
Hyundai Kia Motors Resumes Operations at All Overseas Plants... Full Normalization Will Take Time

[Asia Economy Reporter Su-yeon Woo] Due to the impact of the novel coronavirus infection (COVID-19), overseas production of Hyundai Kia Motors until April this year decreased by more than 30% compared to the previous year. Local production in China dropped to about half, and the damage was particularly severe in India and Brazil, where factories were completely shut down for the entire month of April.

According to the Korea Automobile Manufacturers Association on the 1st, Hyundai Kia Motors' overseas local production from January to April this year was 870,686 units, a 32% decrease compared to the same period last year. By region, production at local Chinese factories such as Beijing Hyundai (-53%) and Dongfeng Yueda Kia (-51%) from January to April fell by 52% compared to the previous year, down to 155,608 units.

Next, the reduction was significant at Hyundai Motor Brazil (-39%) and Hyundai Motor India (-41%) factories, which completely stopped operations for the entire month of April. In addition, European bases such as Hyundai Motor Czech Republic (-35%), Kia Slovakia (-21%), and Hyundai Motor Turkey (-10%) factories were also not spared from the impact of COVID-19.

The U.S. factories, which decided to shut down later than Europe, saw relatively smaller decreases. From January to April this year, Hyundai Motor Alabama plant produced 79,432 units, a 26% decrease compared to the previous year, and Kia Motors Georgia plant also produced 66,670 units, down 26%.

Hyundai Kia Motors Overseas Local Factory Production from January to April This Year / Data = Korea Automobile Manufacturers Association

Looking only at April, when shutdowns fully began, Hyundai Kia Motors' overseas production dropped by 73% compared to the previous year, reaching an almost complete production paralysis. In April, Hyundai and Kia's India and Brazil plants had zero production, while Hyundai Motor plants in the U.S., Turkey, Czech Republic, Russia, and Kia plants in the U.S. and Mexico all saw production fall below 10,000 units.

Meanwhile, global finished vehicle production, which was hit hard by COVID-19, passed its low point in April and has gradually entered a recovery phase, with reactivation starting in May. The global factory operating rate of finished vehicle manufacturers, which fell to about 28.8% in mid-April, recovered to 83.5% by mid-May.

In line with this trend, Hyundai Kia Motors' overseas factory operations were fully normalized as of the 26th, with the Kia Motors Mexico plant being the last to resume operations. Since April, Hyundai Motor plants in Russia, Czech Republic, and Turkey have resumed operations, and U.S. and India plants also started running their lines again this month. At the end of April, Hyundai Motor dispatched technical personnel by charter flight to the Turkey and Czech plants to conduct line inspections in preparation for new vehicle production, carrying out preliminary work for factory reactivation.

With the resumption of operations at the Kia Motors Mexico plant on the 26th, which had been delayed once due to Mexican government guidelines, all Hyundai Kia Motors factories worldwide have restarted operations. However, it is expected to take considerable time to fully normalize the production lines after resumption. An industry official said, "Even if the lines are restarted immediately, we have to first process the backlog of orders, recheck product quality, and adjust workforce supply from the beginning," adding, "There is still a possibility of COVID-19 spreading within the factories, so it will take time to fully normalize operations."