Hyundai Stops Operations of 4 Plants in China Due to Supply Problems

Korea News Gazette

August 31, 2017

Hyundai Motor Co., South Korea’s largest carmaker by sales, said Tuesday its four plants in China have stopped operations as a local supplier refused to provide products due to delayed payments.

Beijing Hyundai Motor Co., a joint venture set up between Hyundai Motor and BAIC Motor Corp. in 2002, began to gradually stop the assembly lines at its four plants—one in Hangzhou and three in Beijing—from the middle of last week due to the lack of parts, a company spokesman said over the phone.

“A local parts supplier refused to provide a plastic fuel tank to Beijing Hyundai as the carmaker failed to make payments for the parts the supplier already delivered to the plants,” he said.

This year, Hyundai Motor has suffered sharp declines in China sales due to diplomatic rows between Seoul and Beijing over the deployment of an advanced U.S. missile defense system in South Korea.

The four plants have a combined production capacity of 1.35 million vehicles. Lower demand in China remains the biggest worry for Hyundai as China is the Korean carmaker’s biggest automobile market.

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