Business South Koreans to increase Czech investments with Hyundai headlights factory and Nexen tire plant
The South Korean car manufacturer Hyundai is planning to build a new factory to produce headlights about 30 kilometres from its large auto plant at Nošovice in North Moravia. At the same time, South Korea’s Nexen Tire has just inked a deal for a gigantic investment in North Bohemia.
Local representatives approved the signing of an investment deal with Hyundai Mobis and the sale of a site of around 18 hectares to the firm. The headlights factory should open in two years’ time.
The mayor of Ostrava, Petr Kajnar, welcomed the development, saying 900 would be the minimum number of jobs created. Moravia-Silesia has an unemployment rate of around 10 percent, which is above the national average. The investment is worth around CZK 2.5 billion, Mr. Kajnar said.
Hyundai Mobis representative Ivan Leixner told reporters on Wednesday that construction on the factory – which will carry out the entire process of headlight production including final assembly – should get underway in the summer of next year and take nine or 10 months. Mr. Leixner said agreement had already been reached on the building of high-quality roads to serve the industrial zone. Hyundai Mobis is set to sign the deal to purchase the site with local officials in September.
Hyundai Mobis produces parts, chiefly for its mother company but also for Kia and other carmakers, and already has a factory producing lights, brakes and dashboards beside the Hyundai car plant in Nošovice; the South Koreans built the plant in the mid-2000s at a cost of some EUR 1.12 billion.
Wednesday’s news about the headlights factory coincided with the signing of a massive contract between the Czech Republic and another South Korean firm in the auto industry, Nexen Tire.
Indeed, at CZK 22.8 billion Nexen Tire’s investment in a new plant in an industrial zone in Žatec in the Ústí nad Labe region, North Bohemia, will be one of the biggest ever seen in the country.
The value of the deal to the country was reflected in the fact that Prime Minister Bohuslav Sobotka signed it for the Czech side in a ceremony with Nexen Tire director Kang Byung-joong on Wednesday.
Mr. Sobotka said he was proud the Czech Republic had secured the investment in the face of tough competition from Poland and other states after over a year of negotiations.
The Nexen plant is set to produce around six million tires a year and to deliver over 1,000 new jobs in a region with even higher unemployment than North Moravia. Construction work at the 70 hectare site will begin next year.