South Korean automaker Kia Motors has kick-started the trial production of its upcoming SP2i SUV at its Anantapur production facility in Andhra Pradesh. The trial production ceremony was done in the presence of Andhra Pradesh Chief Minister N Chandrababu Naidu along with Kia's Managing Director Shim and South Korea Ambassador to India Shin Bongkil. CM Naidu says that Andhra Pradesh is set to become the next destination for automobiles. He further adds that the state has been able to attract over Rs 40,000 crore investments from automakers in the last four and a half years. Naidu feels confident for the Indian market and says that it will be the biggest market for Kia Motors in the future. Kia's greenfield car manufacturing plant will have an investment of over Rs 12,900 crore. Along with Auto Anciallaries of South Korea, this is one of the largest foreign direct investment. The said production facility in Andhra Pradesh will initially run at a capacity of 3 lakh vehicles per annum and later on, the capacity might be increased to 4 lakh vehicles.
Kia Motors' new Anantapur production facility is already prepared to produce electric vehicles as well. The said facility is the company's 15th plant globally. While 90 percent of production will be for domestic sales, the remaining 10 percent will be for exports. Kia Motors will generate employment for 4,000 permanent employees and 7,000 temporary employees. Apart from this, the South Korean brand will also create an ecosystem for electric vehicles with Andhra Pradesh government.
Kia Motors says that close to USD 2 billion have gone into the investment of their Anantpur plant. Out of this, while USD 1 billion have come from Kia's side, the remaining will be coming from the vendors. The brand says that the ultimate aim is to deliver quality products for the Indian market. Andhra Pradesh is one of the first few states to pro-actively bring out a very dedicated automobile and auto components policy in 2015 through backward areas ultra mega integrated automobile projects policy. It is one among the first to bring a dedicated policy for promoting manufacturing and adoption of electric vehicles.
The state has the presence of more than 100 auto component manufacturers. Kia Motors is running ahead of their schedule as the production at the company's production is starting a month earlier than expected. The upcoming Kia SP2i SUV will be launched in India in July this year. The SUV will be priced in range of Rs 9 lakh to Rs 16 lakh. Kia Motors say that after the first launch of its vehicle in the Indian market, the customers can look forward to three new vehicle launches with each one getting launched every six months.